Date
26 September 2017
Supertankers can be used to store oil as well as transport it. Photo: Bloomberg
Supertankers can be used to store oil as well as transport it. Photo: Bloomberg

Supertanker earnings rise as oil price plunges

The earnings of supertankers on the key route from the Middle East to Japan soared to a six-year high in mid-December, the Financial Times reported.

China has been a major customer as it builds up its strategic fuel reserves while oil prices plunge.

Daily earnings reached US$97,489 on the benchmark route, the highest levels since 2008, Baltic Exchange figures show.

Just six months ago, tanker rates were so low that shipowners couldn’t cover their daily operating expenses.

Oil prices have dropped to below US$60 a barrel for the first time since May 2009 — having been slashed by almost half in the last six months. 

Between January and November, China imported six million barrels a day on average, up 500,000 barrels from the same period last year, energy data firm Argus Media said.

And much of the oil is coming longer distances from non-traditional sources such as West Africa and South America.

The tanker industry could receive a further boost in the coming months as the oil surplus grows, the Financial Times said.

When prices for future delivery exceed spot prices, traders buy oil and store it on tankers, hoping to sell it later at a profit.

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