The cost of hiring oil tankers in the North Sea jumped by a record amid speculation that companies are seeking the vessels to stockpile cargoes at sea as future crude prices incentivize the trade.
Rates for Aframaxes to ship 80,000 metric tons of crude, about 600,000 barrels, surged 54 percent to 170.50 Worldscale points, according to the Baltic Exchange in London. The increase is the largest in a single day since at least 1998, excluding at the start of trading each year when the Worldscale price system is reset to take account of changes to fuel costs and port fees.
Brent futures for September jumped 64 cents to $107.49 a barrel today, about $1.35 more than August contracts, according to data on the ICE Futures Europe exchange. When the gap between immediate and later prices gets wide enough, it sometimes covers the cost of hiring ships and selling the oil later at the higher price. The difference between the two months widened amid signs that supplies from Libya may rebound following a yearlong blockade of the nation’s eastern ports.
“I have spoken to many owners and the reason is that there are a lot of cargoes in the market but no ships to store them,” Haykel Sahraoui, an analyst at Geneva-based shipbroker Riverlake Group, said by phone.
Today’s surge in shipping rates also drove up the amounts owners earn from charters. Day rates for Aframaxes in the North Sea climbed more than threefold to $66,039 and have risen almost eightfold in a week.
Analysts at Bank of America Corp. and Energy Aspects Ltd. said in the past two days the current oil-price curve, known as a contango structure, is sufficient to encourage floating storage, a trade once used by companies including BP Plc and Citigroup Inc.
JBC Energy GmbH said yesterday the contango needs to widen further while Dynacom Tankers Management, a Glyfada, Greece-based tanker owner, no vessels had been booked for storage. The August Brent crude future expires today. The difference between September and October prices is about 23 cents.