New Worldscale Takes Effect—Intertanko Offers Informative Booklet

A new tool for tanker chartering called New Worldscale took effect on January 1, 1989, replacing the "old" Worldscale which has lasted since 1969.

No immediate rate comparisons can be made between the old Worldscale and the New Worldscale.

There is no "rule of thumb" conversion factor between the two scales; all one can say is that a higher number of New Worldscale points (compared with old Worldscale) are required to achieve the same dollar figure.

For example, to obtain the same dollar freight for a cargo of 240,000 long tons crude oil at the current level of Worldsdcale 67 for a voyage Ras Tanura to Rotterdam via Cape, the equivalent New Worldscale rate would be 75. Worldscale 130 for 80,000 long tons Ras Tanura to Yokohama equals New Worldscale 160.

However, to compare an old Worldscale level with a New Worldscale level would be to compare apples and oranges. What one has to compare are what the various freight levels are, translated into dollars and cents (remembering to take into account that the New Worldscale is based on metric tons and the old one on long tons).

The ideal purpose of a scale is to provide the same net return per day (i.e., freight less bunker costs port charges, canal dues, etc.), irrespective of the voyage performed. There has been a growing number of anomalies under "old" Worldscale, stressing the need for a new scale.

Fixtures are made with reference to an agreed percentage of the flat rate—the so-called New Worldscale 100. These flat rates are a set of dollar figures quoting the freight per metric ton for each of a very large number of possible voyages. Apart from being a useful tool for chartering, the Scale system provides a shorthand method for comparing market levels.

Intertanko, the International Association of Independent Tanker Owners, has recently produced a booklet describing New Worldscale.

At the same time, the publication points out several aspects of tanker chartering which are not solved by New Worldscale.

For a copy of the booklet, Circle 20 on Reader Service Card

Maritime Reporter Magazine, page 79, Apr 1989

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