Oil Market's Last Bastion of Strength Is Now Crashing: Chartby
Tanker rates that surged in oil price crash are now plunging
Shipbrokers say fewer Middle East cargoes to be shipped
Tanker rates were the thing that boomed while oil prices crashed. Now it would appear the party is over, or at least the music has stopped.
Day rates from delivering Saudi Arabia’s oil to Japan, an industry benchmark, fell to $50,955, according to the Baltic Exchange in London on Wednesday. They were above $100,000 just a month ago.
Oil tanker earnings boomed thanks to the very thing that drove down crude prices: an abundance of supply that made ship-fuel cheaper and shipments plentiful. This month, shipbrokers report a slump in spot cargoes from the Middle East. While they say it would be premature to suggest that has implications for the region’s output, the plunge in rates shows just how sensitive owners are to monthly fluctuations in shipments.