Ship glut hurts oil tanker earnings

Crude oil tanker earnings on the major Middle East route were steady yesterday although a surplus of vessel availability was capping rates.
The world's benchmark VLCC export TD3 route from the Middle East Gulf to Japan reached W43.20 in the worldscale measure of freight rates, or $ 15,592 a day when translated into average earnings.
That compared with W43.08 or $16,023 a day on Friday and W42.83 or $ 16,136 a day last Thursday. The Baltic did not publish comparable data last Monday due to the holiday season.
According to Reuters, Brokers said firmer bookings in recent days were being offset with a glut of tankers.
“VLs are currently trading at $ 16,000/day on TD3 and we do not see any short-term moves higher,” Arctic Securities analyst Erik Nikolai Stavseth, told Reuters.
Tanker players said downside risks remained for the sector, given risks to the global economy and the fact that more tankers, ordered when times were good, were still to join the global fleet this year.
“The demand side looks less encouraging should oil analysts' prediction of lower demand for OPEC oil materialise. Our base case is therefore for weaker oil trade and somewhat lower rates than last year,” RS Platou Markets said.