Saturday, 15.12.2007, 12:42am (GMT)
Asian aframax rates may rise from the highest in almost two years, boosted by gains in supertanker rates and shipowners signing up transport for early January cargoes before the holidays.
The rate to transport 80,000 metric tons of fuel from Kuwait to Singapore jumped 2.8 percent yesterday to Worldscale 255.42, according to the London-based Baltic Exchange. That's the highest since Jan. 18, 2006. Shipping a ton of fuel on the route costs $20.94, based on Bloomberg data.
Aframax rates on the Middle East-Singapore route surged 78 percent in the past eight weeks, boosted by fuel needs for the Northern Hemisphere winter, higher costs of bunker prices which shipowners had to pass on and strong demand for supertankers which trickled down to aframaxes.
The aframax market is ``very, very buoyant and it's on the back of the big ships, the very large crude carriers,'' Channa Munasinghe, director at shipbroker Alliance Tanker Chartering Pte in Singapore, said by phone today. ``Sentiment is all high. There's no sign of rates coming down for the time being. People are saying that aframax rates should be close to the very large crude carriers or more.''
Freight rates for supertankers, also known as very large crude carriers, or VLCCs, have risen fourfold on the benchmark Persian Gulf-to-Japan route since the start of October, according to data on the Baltic Exchange. Rates on the route climbed 2.5 percent to Worldscale 235 yesterday.
Oil Spill
An oil spill last week involving a single-hull tanker in South Korea created more demand for double-hull vessels, prompting charterers to split their cargoes into smaller tankers such as suezmaxes and aframaxes.
The rise in VLCC rates has a ``knock-on effect'' on aframax rates, according to Takeshi Ando at the tanker team of shipbroker Matsui & Co. in Tokyo said.
Six aframaxes, capable of moving a total of 618,583 tons of fuel, are scheduled to arrive in Singapore this week while three with a combined capacity of 318,862 tons will arrive in the next two weeks, according to Bloomberg data. That compares with two, with the capacity to haul 218,342 tons of fuel, last week.
The collision between a barge and the single-hulled supertanker Hebei Spirit on Dec. 7 in South Korea spilt 10,500 tons (78,750 barrels) of oil, the worst oil spill in the world in 4 1/2 years.
Source: Bloomberg