Persian Gulf Tanker Rates Post Biggest Increase in Six Weeks

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

19 Mar 2008

The cost of shipping Middle East crude to Asia rose the most in more than six weeks amid tanker bookings by Chevron Corp. and ENI SpA. The two companies both hired so-called very large crude carriers to ship a combined 4 million barrels of crude oil from ports in the Persian Gulf, Paris-based shipbroker Barry Rogliano Salles said in a report today. The London-based Baltic Exchange's benchmark assessment for voyages to Asia rose 19.9 percent to 112.03 Worldscale points today. That's the biggest daily increase since Jan. 30. Worldscale points are a percentage of a nominal rate, or flat rate, which give owners and oil companies a starting point for negotiating hire rates. At 112.03 Worldscale points, owners of double-hulled VLCCs can earn about $76,755 a day on a 39-day round trip from Saudi Arabia to South Korea, based on a formula by R.S. Platou, an Oslo-based shipbroker, and marine-fuel prices compiled by Bloomberg. Frontline Ltd., the world's biggest VLCC operator, said Feb. 15 it needs $31,400 a day to break even on each of its supertankers.