VLCC Rates Fall as Ships Compete for Fewer Available Cargos

The surplus of the largest oil tankers available for loading in the Middle East rebounded from a six-week low, according to a Bloomberg News survey.

There are 19.5 percent more very large crude carriers for hire over the next 30 days than there are cargoes, the median estimate of six shipbrokers and owners showed today. That was up from 15 percent on Jan. 8, when the excess was the smallest since Nov. 27, according to prior figures. No surveys were conducted for the weeks of Dec. 25 and Jan. 1.

Daily earnings for the vessels on the benchmark voyage to Asia from the Middle East fell 19 percent since the start of the year to $13,437, according to the Baltic Exchange, the London- based publisher of shipping costs. Each VLCC can hold about 2 million barrels of crude.

The exchange’s assessments don’t reflect owners cutting speed to save fuel, their biggest expense. The cost of ship fuel, known as bunkers, fell 0.5 percent to $625.39 a metric ton yesterday, data compiled by Bloomberg from 25 ports showed. Last year’s average of $658.54 was more than double the price for 2008, according to the figures.

– Rob Sheridan, Copyright 2013 Bloomberg.