Dubai: Strengthening demand for VLCC shipments in global oil markets is not reflected in spot markets for Middle East oil cargoes on account of a surplus of tonnage. A surfeit of tankers means that 20% more vessels will be competing for shipments over the coming 30 days than available consignments, according to a news agency report. Bloomberg said it surveyed nine shipbrokers, shipowners and derivative brokers to obtain the median statistic, published earlier this week.
In the first half, the excess figure averaged 11%, but has varied between 15% and 25% during the second half, reports said, indicating a dissipation of earlier year market tightening.
"The tonnage oversupply is simply too much," even though demand for tankers is "decent" in the Persian Gulf, Henrik With and Glenn Lodden, Oslo-based analysts at DnB NOR Markets, were quoted as saying in an emailed report.
However, futures markets suggest that the market will bounce back in the fourth quarter. Daily returns from the benchmark Saudi-Japan route average $14,251 this quarter, but are expected to jump to $23,575 in the last quarter of the year, according to data from the Baltic Exhange and Imarex ASA. [24/09/10]
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