Asian product tanker rates surge

Asian oil-product tanker rates rose, led by demand for larger vessels to transport gasoline, naphtha and other products before the northern hemisphere winter.

The rate to hire a ship that can carry 75,000 metric tons of oil products, or a so-called long-range 2 tanker, to Japan from Singapore rose 1.9 per cent to Worldscale 131.25 on Monday, according to the London-based Baltic Exchange.

Hiring a 55,000-tonne vessel, a long-range 1 tanker, to Japan from the Middle East increased 1.45 per cent to Worldscale 155.58 on Monday.

Oil companies typically stockpile fuel before the winter to prepare for any potential increase in demand caused by cold weather conditions. Oil inventories in Japan, the world's third-largest oil consumer, rose 0.7 per cent in the week of Oct 31 from a week earlier, according to government data.

"The products market has enjoyed a very healthy week both East and West of Suez with a lot for owners to be optimistic about," London-based E A Gibson Shipbrokers Ltd said in its Nov 9 report. Royal Dutch Shell plc's trading unit plans to book the tanker Elka Aristotle to transport 75,000 tonnes of naphtha on Dec 1 to Japan from the Middle East at a rate of Worldscale 132.5, according to shipbrokers including Singapore-based Seatown Shipbroking.

The rate is a 2.8 per cent premium to the Nov 9 rate of Worldscale 128.83, boosting hiring fees on the route.

The fixture has yet to be completed. Naphtha, distilled from crude oil, is a raw material for chemicals, plastics and gasoline.