Historically high US crude exports have given a boost to spot rates for very large crude carriers making long-haul voyages east from the US Gulf Coast, a trend that is expected to continue into March and April, according to shipping sources. The cost of carrying crude on a VLCC loading on the USGC has been on a steady climb upwards since February 12, when rates for the VLCC 270,000 USGC-China route were at their lowest level since September 2018. Freight was last assessed at lump-sum $7 million March 1, up $1.6 million, or 29.6%, from the 2019 low of $5.4 million. Freight rates for the route were heard at the same level March 4. Exports of US crude reached a record for the week of February 15 at 3.607 million b/d, with the most recent week of February 22 maintaining those levels at 3.359 million b/d, US EIA data shows. The jump in US export volumes and high demand for VLCCs is apparent in vessel traffic flow. There have been 48 VLCCs booked for loading out of the USGC so far in 2019 – about five times the amount booked in the first two months of 2018 and a drastic… continue reading
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Source: CTRM Center