Rates for the world’s biggest oil tankers surged to the highest since January as shipments accelerated from Saudi Arabia and Iraq, the two biggest suppliers in the Persian Gulf.
Ships hauling 2 million barrel cargoes of Saudi Arabian crude to Japan, a benchmark route, earned $81,513 a day, according to data on Friday from the Baltic Exchange in London. That’s a 13% gain from Thursday and the highest for the time of year since at least 2009.
Saudi Arabia told OPEC it produced 10.3 million b/d last month, close to the highest level in three decades, as the world’s biggest exporter defends its share of the global oil market. Iraq’s crude exports next month will climb by almost 700,000 b/d to 3.75 million, compared with April, according to loading programs obtained by Bloomberg.
“The world is flowing over with oil, which is good for the ones transporting it,” Eirik Haavaldsen, an analyst at Pareto Securities AS in Oslo, said by phone Friday. “This is the weakest point of the year when crude tanker rates are usually at their lowest.”
The rate oil companies pay to charter the ships, known in the industry as very large crude carriers, or VLCCs, jumped 9.1% to 76.82 Worldscale points, a measuring system the industry uses to calculate per-ton freight costs on thousands of trade routes. Tanker rates rose on 15 out of 16 routes tracked by the Baltic Exchange, led by advances in prices from the Persian Gulf.
China, the second-biggest economy, imported record amounts of crude in April, according to customs data. The nation bought the equivalent of 7.4 million b/d, rising almost 17% from March and up 3.1% from the previous high in December.
The number of supertankers sailing to Chinese ports rose almost 10% in the past week to 68, signals from the ships compiled by Bloomberg from IHS Maritime data showed Friday. That’s enough to transport 136 million barrels of oil, the highest for the time of year in records dating back to October 2011.
A Saudi-led push by the Organization of Petroleum Exporting Countries to defend its share of the global oil market has just begun, the International Energy Agency said May 13. The 12-nation group, which pumps about 40% of the world’s oil, may further increase production, it said.
“Record Saudi exports and record China imports equal strong VLCC demand and rates,” Jonathan Chappell, an analyst at Evercore ISI in New York, said by e-mail. “This type of spike shows how tight the market is.”