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VLCC market goes boom as rates soar past $100,000 per dayVLCC market goes boom as rates soar past $100,000 per day

It has been a stellar couple of weeks in the VLCC market where earnings topped $100,000 a day on routes east.

Ian Middleton, Former Tanker Correspondent

October 14, 2015

1 Min Read
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Caribs - Singapore, in particular, was generating a mouth-watering $124,000 a day, for owners with vessels in Europe to ballast across the Atlantic. Earnings Gulf -West, much the weaker partner in the last few years, were not far behind.

Extra stems from Iraq seem to have provided the main impetus for the spike and, as London broker EA Gibson notes, all eyes will be on the November Basrah stem list to see if it replicates October. VLCC spot fixtures in September totalled 195 - a record for this year.

There does not seem to have been much of a trickle-down effect to the other large sizes though suezmax average earnings remain above $40,000 a day and aframaxes above $30,000 a day, and moving up again.

Meanwhile the US House of Representatives voted to overturn the 40-year restrictions on exports of US crude. However the bill did not get enough support to overthrow a presidential veto, and the White House has indicated it will can the bill. The Senate version of the bill also faces an uphill struggle according to commentators.

The case for lifting the ban is that it would help solve the mismatch between US refinery configurations and the type of oil predominantly produced in the US. It would potentially give a further boost to the tanker market though calculating the likely effects on global oil trade flows is a very difficult exercise.

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About the Author

Ian Middleton

Former Tanker Correspondent

Ian Middleton is former editor of Tanker Trends, and before that of both Seatrade magazine and Seatrade Week. After having begun his career with a leading UK newspaper chain, Ian joined Seatrade in the late 1970s, allowing him a ringside view of the up's and down's of the shipping business from the 1980s slump onwards.

With his specialist knowledge of the tanker market, Ian is one of Seatrade's most experienced writers and a practised conference speaker and moderator.

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