Owners of Very Large Crude Carriers (VLCC) by agreeing to current low rates are effectively paying shippers for the priviledge.
Hire costs for the largest oil tankers are so low and the oversupply of the vessels is so acute that shipowners are paying to carry crude for clients, BTPremium was informed by Braemar Seascope.
Owners of very large crude carriers (VLCCs) that haul two million barrels are losing US$5,700 daily on a return voyage on the industry's benchmark route to Japan from the Middle East, the London-based shipbroker said in a report e-mailed last week. That rate fails to account for possible speed cuts aimed at reducing cutting use of fuel, owners' biggest expense, known in the industry as slow-steaming.
Returns for VLCCs that ship about 20 per cent of seaborne crude are at record lows on the two most profitable routes for the ships, to Asia and the US from the Middle East, as too many tankers compete for business, Frontline Ltd, the largest operator of the vessels, said last week.