Page 34: of Maritime Reporter Magazine (June 1998)

Tanker time charter earnings ($'000/day) 3-month moving average

AG- S.Korea 200-300 ~ Tanker time charter earnings ($'000/day) 3-month moving average

AG- S.Korea 200-300

Tanker Markets Endure Political, Economical, Cyclical Turmoil by John C. Harris, dire

Drewry Shipping Consultants Ltd.

Source: Drewry Shipping Consultants Ltd.

Maritime Reporter/Engineering News

A buoyant tanker market has kept many ships on the waters. Here, the 1974-built VLCC Monrovia is shown undergoing its fourth special survey.

Drewry T JL. £ ances

Ihe tanker market pro- vides a transportation service to rectify imbal- between the main oil producing and consuming nations. More than 80 percent of crude oil pro- duction is moved on a seaborne basis, with trades from the Middle East dominating. In contrast a much smaller proportion of refined products are traded, some representing export orientated refineries, but many being intra- regional balancing movements. The larger the tanker the greater the economies of scale — but there are two important limitations. Firstly, ports provide physical restrictions to trade — generally in terms of draft, and secondly, oil is traded in varying parcel sizes which will influ- ence the optimum vessel size.

The largest crude oil tankers (a mere handful) when laden are in excess of 500,000 dwt, but generally the principal traders are VLCCs (here defined as vessels of 200-320,000 dwt).

VLCCs find most of their employment trading from the Middle East to Asia, Europe and the

U.S. Gulf/Caribbean. Only one U.S. terminal can handle fully laden VLCCs — the Louisiana

Offshore Oil Port (LOOP) — and many vessels are lightered off the U.S. Gulf Coast into small- er vessels. Suezmax tankers (defined as 110- 200,000 dwt) are engaged in a range of trades, most usually from West Africa to the U.S.

Gulf/Caribbean or Europe, within the

Mediterranean, or within Asia. Aframax tankers (70-110,000 dwt) are employed in shorter regional trades — mainly in North

West Europe, the Caribbean, Mediterranean and Asia. Finally, Panamax tankers (50-70,000 dwt) represent a more specialized niche and take advantage of draft restrictions in South and North America, and are heavily employed on these trades.

A number of oil tankers have the capability to carry crude oil or refined products, but it is usual for a vessel to trade refined products.

The majority of product tankers lie in a size

Tanker time charter earnings ($'000/day) 3-month moving average

AG- Japan 200-300 " Tanker time charier earnings ($'000/day) 3-month moving average

AG-Japan 200-300