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Tuesday, December 12, 2017

Number of period contracts likely to exceed those in each of the last three years

So far in 2006 we have recorded 119 period contracts of 6 months and more. 12 were for a period below one year, 28 for one year, 20 for two years, 44 for three years and 24 for a period of between three and 10 years.

 

As can be seen from the table below, the average age of the tankers taken on period contracts is only 5.6 years. Only two tankers were built in the 1980s and only 39 in the 1990s. The remainder (78) have all been built since 1999. However, the average size of tanker chartered is higher than any year since 1999, and 15% up on last year where the average size was the lowest since 1999.

 

Yet the average rate level is somewhat below that of last year. Eleven contracts were reported with rates below USD 20,000 per day and these concerned mainly product tankers. The highest rate of USD 52,000 per day was reported for a 2002-built VLCC for a three-year contract. Eleven VLCCs, one aframax and one suezmax obtained rates of USD 40,000 per day and more.

 

Recorded period contracts

Year

Average Age

‘000 dwt

Average dwt

Number Contracts

Average Period

Av. TC Rate

2000

9.5

18,385

114,194

161

1.4

20,351

2001

8.5

23,442

106,880

219

2.4

23,437

2002

7.3

23,570

111,707

211

1.9

16,172

2003

8.7

13,046

120,799

108

2.0

18,047

2004

8.7

18,521

111,706

143

2.4

26,203

2005

5.1

16,201

106,586

152

2.8

30,803

2006*

5.6

14,564

122,387

119

2.7

28,940

*January – August

 

Among the charterers we have recorded, those that took the most contracts were Glencore (9), Petrobras (8) and PDVSA and BP (6 each). If the period activity continues at this rate, the number of contracts will exceed that reached in each of the previous three years. Altogether 119 charters have been recorded so far this year, including several involving independent owners.

 

In March, Johan G. Olsen reported that 70 of the 356 existing suezmaxes (20%) were fixed until 2008 and later, and 99 of the 482 existing VLCCs (21%) were fixed until 2008 and later. Of the suezmaxes, BP and ExxonMobil had three each and of the VLCCs, ExxonMobil had 11, Shell 2 and Tokyo Tankers 21 on contract until 2008 and later.

 

Contact: Erik Ranheim