Friday, September 12, 2014
Thursday, September 11, 2014
Wednesday, September 10, 2014
Iraq renews attempts to seize Kurdish 'ghost ship' oil tanker in US court
Iraq has refiled in US court in an attempt to control a Kurdish crude oil tanker that has been stationed around 60 miles off Texas since late July. The refiling comes days after the court said it lacked jurisdiction to seize the cargo.
Iraq has urged a US district court to intervene and take control of the United Kalavrvta tanker’s cargo until the dispute is resolved, according to Reuters, claiming that the US court does have jurisdiction given the case involves business conducted in the United States.
"This Court has subject matter jurisdiction over the claims against John Doe Buyer," Iraq said in its motion. US District Court Judge Gray Miller invited Iraq to replead the case.
The Iraqi government - which says it has sole rights to export crude oil in the country - has deemed the shipment of Kurdish crude oil illegal. Baghdad filed a lawsuit in the US in June, preventing any purchaser from unloading the Kurdish shipment.
The Kurdistan Regional Government has yet to say if it owns the tanker, according to Iraq. Kurds have argued that the sale of their crude is essential to their dreams of an independent Kurdistan – while the US State Department has publicly backed Baghdad’s stance.
When Iraq’s government initially filed the lawsuit over United Kalavrvta, US District Judge Nancy K. Johnson ordered the seizure of the tanker’s $100 million payload, but only if the tanker entered the territorial waters of the US.
On August 28, the US Coast Guard said its AIS ship tracking system reported having no known position for the United Kalavrvta. It is alleged that the Kurd tanker switched off its transponder to avoid detection.
The tanker now sits off the coast of Texas awaiting the results of litigation.
Kurdish oil tankers have previously switched off their electronic transponders, essentially making their movements impossible to track.
Last month, a Kurdish tanker carrying crude disappeared from satellite tracking north of Egypt’s Sinai, only to reappear empty two days later near Israel. In July, a tanker offloaded part of its cargo of Kurdish crude onto another ship in the South China Sea.
As recently as June, Iraq’s central government made an attempt at barring Kurdish oil sales but it was ultimately rejected by Iraq’s Supreme Court.
Total books VLCC with storage option as crude oil falls below $100
http://www.platts.com/latest-news/shipping/singapore/total-books-vlcc-with-storage-option-as-crude-26876574
Oil traders are aggressively looking to hire VLCCs for storage purpose due to weak demand and falling prices, with French oil major Total reportedly fixing a VLCC with a storage option in the Persian Gulf, participants tracking the supertanker segment said Tuesday.
The company has taken the Xin Yong Yang at 43 Worldscale points for September 25 loading on the Persian Gulf to East route, basis 270,000 mt, with a 10-to-30 days storage option at $37,500/day, owners, brokers and charterers said.
"We heard that the storage will be at Fujairah," said a VLCC broker in Tokyo. Charterers think crude price will be higher later, the broker said.
Total executives could not be immediately reached for comment.
Another broker in Singapore said, "There is plenty of crude floating around but this is done more in smaller ships."
ICE Brent crude futures traded below $100/b Tuesday due to oversupply as Libyan exports and the upcoming maintenance runs by some refineries weighed on prices.
Weak crude demand has also brought down the number of VLCC fixtures.
One of the reasons driving demand for ships for storage is that there have been fewer loadings this month from the Persian Gulf and the Red Sea, the same Singapore-based broker said.
So far, 79 VLCC fixtures for Persian Gulf and Red Sea loading are estimated done for September, including 67 for the East, four for the West and eight for optional voyages, according to brokers.
Overall fixtures are estimated at 123 for August, including 17 for destinations in the West and 106 for the East.
Though there are still outstanding cargoes for loading in the third decade of September that are yet to be covered with tonnage, market participants expect fixtures to be lower than August.
Weaker demand has dragged down crude prices, leaving suppliers with no option but to hold back their inventories and hope for higher rates in the short term.
Storage of crude in landed tanks is not always available at a preferable location and for exactly the duration a company wants to hold the volume.
In contrast, chartering of ships for storage is relatively flexible in terms of location and duration.
"One possibility is that they [Total] will sell this cargo if they get the price [they are aiming at] and then top up the ship with another cargo," one of the brokers said.
Recently, an ultra large crude carrier, the 442,000 dwt, 2002 built TI Europe, was taken on a six-month time charter by Unipec at a daily rate of $25,600.
There is an option to extend the time charter period by another six months at $28,600/day.
Such options impart flexibility in the trade of floating crude.
Shipowners are also hoping that the trend of holding crude in floating storage will pick up.
"If the price of crude continues to fall, there will be more opportunities for ships being taken for storage," said a Singapore-based source with a VLCC owner.
Owners said that a short-term storage deal can be compared with a round-voyage from Persian Gulf to China, which will take almost two months.
If the daily earnings are attractive, owners will give the ship for storage for the same duration, they said.
Nevertheless, the current forward structure of crude prices is not really an attractive storage opportunity because the contango is not deep enough for storage economics to work well, said an analyst with a North Asian refiner.
"This push into storage is not because there is a contango. [Instead] it is because there is [less] demand, which has led to a contango," he said.
The spread between the front-month and three-month forward Brent crude has declined below $10/mt from $12/mt nearly a month earlier.
Time charter rates for VLCCs are also on the rise in anticipation of more demand, though not necessarily for storage.
Earlier this year, the 2010-built, 321,000 dwt Blue Topaz was taken for a 12-month time charter by Koch at a daily rate of $22,000, according to brokers.
Market participants said time charter rates for the same duration would now be above $25,000/day, perhaps even close to $28,000/day.
--Sameer C. Mohindru, sameer.mohindru@platts.com
--Edited by Alisdair Bowles, alisdair.bowles@platts.com
Subscribe to:
Posts (Atom)