The number of supertankers sailing toward China’s ports surged to a nine-month high amid speculation an oil-price slump is encouraging the world’s second-biggest crude importer to accelerate purchases.
There are 80 very large crude carriers, the industry’s biggest ships, sailing toward the Asian country’s ports, according to IHS Fairplay vessel-tracking signals compiled by Bloomberg at about 10 a.m. today. That’s the highest since Jan. 3. Average shipments are 2 million barrels.
Brent crude, the global benchmark, plunged to a four-year low yesterday amid speculation Saudi Arabia, Kuwait and other nations in the Organization of Petroleum Exporting Countries won’t curb production. The slump is likely encouraging buying to fill China’s strategic stocks, according to Energy Aspects Ltd., a London-based consultant.
“There’s a lot of bargain hunting going on,” Richard Mallinson, an analyst at Energy Aspects, said by phone. “Whilst prices are low we think there’ll be buying for Strategic Petroleum Reserve filling and also just trying to capture these discounted crudes.”
Brent crude pared its slump today after Goldman Sachs Group Inc. said there was no glut of oil and that prices have plunged too far. December contracts gained 0.6 percent $86.32 a barrel at 1:40 p.m. today in New York. WTI, the U.S. benchmark, was up 0.6 percent at $83.17.
China has about 41 million barrels of commercial oil storage and strategic petroleum reserve which is available to be filled, Energy Aspects estimates. New facilities are also coming online, Mallinson said
Shipping rates are also rallying. VLCCs transporting crude to Asia from the Middle East are earning $25,873 a day, close to the highest in two months, according to the Baltic Exchange in London.
Most ships in the merchant fleet signal their destinations, depth in the water, speeds and other movement data. The number of supertankers headed for Japan are the highest since December. Those to South Korea and India also climbed.
The 80 bound for China compare with an average of 63 for the past two years and match a record in data that started in October 2011. China’s crude imports averaged a record 25.298 million metric tons in the first eight months, customs data show.
“It’s a good forward indicator of Chinese purchases,” said Julian Lee, a strategist who writes for Bloomberg First Word. “It gives us an indication of their imports well before customs data become available.”