The surplus of tankers competing to ship 2 million-barrel oil cargoes from ports in the Persian Gulf fell to a two-week low, according to a Bloomberg News survey.
There are 15 percent more very large crude carriers seeking charters over the next 30 days than probable shipments from the world’s largest cargo-loading region, the median in the survey of four shipbrokers and two owners showed today. The glut was the lowest since June 4 and compared with 18 percent last week.
The VLCC fleet’s capacity expanded 39 percent in the past five years, according to data from IHS Fairplay, a Redhill, England-based maritime-research company. Hire costs for the vessels on the industry’s benchmark Saudi Arabia-to-Japan route fell to this month’s lowest level, figures from the Baltic Exchange in London showed today.
“WS numbers are softening,” Marex Spectron Group said in an e-mailed report, referring to the industry-standard Worldscale points by which charter rates are measured.
Freight rates slumped 1.1 percent to 41.28 Worldscale points, the lowest since May 24, according to the exchange. Daily earnings for VLCCs on the benchmark voyage fell 9.2 percent to $13,633, also June’s low, its figures showed.
The exchange’s earnings assessments don’t account for owners’ efforts to improve returns by securing cargoes for return-leg voyages or reducing speed to burn less fuel, the industry’s biggest expense.
The Baltic Dirty Tanker Index, a broader measure of oil- shipping costs including smaller vessels, fell for a 12th session in 13 to 583, according to the exchange. The gauge is at the lowest since November 2009.
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 41.28 percent of the nominal Worldscale rate for that voyage.
The biggest one-day change for ships hauling crude was for tankers headed to the U.S. East Coast from the Caribbean, down 3.7 percent to 105.50 Worldscale points. For vessels carrying refined fuels, the largest move was for ships bound for northwest Europe from the U.S. Gulf Coast, up 6.2 percent to 97.86 points, according to the exchange.