Feb. 13 (Bloomberg) -- Hire costs for the largest oil tankers remained near the 2013 low as this week’s holiday in China, the world’s second-biggest crude consumer, curbed hiring of vessels.
Booking rates for very large crude carriers on the benchmark Saudi Arabia-to-Japan voyage were little changed today at 31.28 industry-standard Worldscale points, figures from the London-based Baltic Exchange showed. Charter costs are within about 3 percent of this year’s lowest level, reached Jan. 28.
Activity in the VLCC market was “limited,” keeping rates steady, the consulting unit of Oslo-based shipping-services and investment-banking company Astrup Fearnley said in an e-mailed report. Still, Chinese charterers continued to book vessels to import crude from West Africa, it said. Financial markets in the Asian nation are shut this week for the Lunar New Year.
“Charterers are slowly starting to fix tonnage for March dates, but still a number of players are awaiting their March stem dates,” Fearnley said, referring to the date when a ship starts taking on a cargo.
Daily losses for VLCCs on the benchmark voyage as determined by the exchange narrowed to $6,954 from $6,997 yesterday. The ships, each able to hold 2 million barrels of oil, earned money in only four sessions in the third quarter on the journey.
The exchange’s assessments fail to account for owners’ efforts to improve returns by securing cargoes for a voyage’s return leg or reducing speed to burn less fuel, known as slow-steaming. The price of fuel, or bunkers, the industry’s main expense, slipped 0.2 percent to $658.52 a metric ton today, figures compiled by Bloomberg from 25 ports showed.
The Worldscale system is a method for pricing oil cargoes on thousands of trade routes. Each individual voyage’s flat rate, expressed in dollars a ton, is set once a year. Today’s level means hire costs on the benchmark route are 31.28 percent of the nominal Worldscale rate for that voyage.
The Baltic Dirty Tanker Index, a broader measure of oil-shipping costs that includes vessels smaller than VLCCs, added 1.2 percent to 655, the highest since Jan. 8, according to the exchange.
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