Some softness in Tanker leases rates, especially to Japan
and the Far east.... and VLCC stands for Very Large
Crude Containers.... thus the symbol for VLCCF--
KnightsBridge Tankers.
--
Futures Commentary
Petroleum
am research update 4/27/01
Petroleum
am research update 4/27/01
pm commentary (4/27/01)
technical commentary (4/27/01)
AM Oil Market Commentary
Kyle Cooper, Houston
Friday, April 27, 2001
Opening Call: Crude +5/15, HU +30/+50, HO +20/+40
Summary
The U.S. petroleum complex was moderately higher in overnight trading. June
crude was up 3 cents at 2847. May gasoline reached a new all-time NYMEX high
of 11140 before ending up 38 points at 11080. May heating oil was up 28
points to 7790. Prices in London are also higher with June Brent up 28 cents
to 2788 while May gasoil is up 250 to 23325. The OPEC basket was at $25.69 while the 20-day average is $24.41.
Norway's crude oil production in March rose slightly to 3.125 million
barrels per day on average from February's 3.058 million barrels and
January's 3.230 million barrels, the Norwegian Petroleum Directorate said
Friday. Production for 2001 is forecast at 3.1 million barrels per day,
peaking at 3.3 million barrels in 2002. Output in 2000 averaged 3.105
million barrels and in 1999 2.900 million barrels. Crude oil production from
the Norwegian Continental Shelf is usually high during the winter months
(October-March) as operations are not affected by maintenance work, which
usually occurs in the summer. Meanwhile the directorate said natural gas
liquids (NGL) production rose to 183,000 barrels per day on average in March
from February's 166,000 barrels per day, while condensate production rose to
132,000 barrels per day on average from 124,000 barrels per day in February.
Persian Gulf very large crude carrier (VLCC) rates have dipped to their
lowest levels in a year for voyages to the Far East. Brokers said this is
due to a number of oil major-controlled tankers being re-let onto the spot
chartering market following refinery turnarounds in the Far East. The recent
OPEC oil cuts are also said to be biting into rates as cargo cutbacks for
May are slowly being felt. Persian Gulf very large crude carrier rates have
now dipped into the high worldscale (ws) 50s for shipments to the Far East,
the lowest levels recorded for a year. Rates to South Korea are now standing
at ws 57 which equates to around $26,000 daily while Japan rates are being
assessed at ws 57, which equates to $41,000 daily. These levels are half the
value of rates in 2000, a boom year for tanker owners, with levels at 10
year highs and peaking at $100,000 daily for Japan discharge in August, the
strongest rate ever recorded on this run. The main reason for the slump has
been the flood of oil-major controlled tankers that are seeking to be re-let
onto the spot market which is adding to an already ample tonnage list.
Refinery turnarounds in the Far East for May, mainly in Japan, has meant
fewer cargoes needing to be shipped to the east. Therefore a number of oil-
majors, who have tankers on period-charter for contract cargoes, are seeking
to re-let these ships on the spot market rather than leave them "sitting
around burning bunkers" until refinery maintenance is completed. Thus they
are willing to undercut rates of other tanker owners as "any return is
better than no return", said one broker. The reason that rates to the Far
East are being affected rather than to the west (which are currently holding
steady at ws 77.5) is that eastbound voyages are generally shorter. These
voyages would only take the re-lets away from the Persian Gulf for up to a
month rather than the two or so months that a voyage to U.S. Gulf and back
would take.
Republicans accused former President Bill Clinton's administration on
Thursday of secretly meeting with environmentalists and ignoring an energy
crisis to protect millions of acres (hectares) of U.S. forestland. The
Clinton administration's ban on road building in federal forests is
supported by green groups and bitterly opposed by oil, natural gas and
timber companies. Republicans including Idaho's Sen. Larry Craig, who heads
the subcommittee on Forests and Public Land Management, and Alaska Sen.
Frank Murkowski said at Thursday's hearing that Clinton officials secretly
met with national environmental groups in early December. "Contacts between
senior Clinton administration officials and environmental group leaders
occurred after the close of the public comment period and after the close of
the final" environmental impact study, Murkowski said. This "represents yet
another statutory violation which the courts will undoubtedly be asked to
review," he said.
Nuclear generation dropped to 78,400 MW, which is 3.6% ahead of last year
and 78% of total capacity.
ACCESS Open High Low Last Change
June CL 2845 2858 2833 2847 +03
July CL 2875 2883 2869 2877 +08
May HU 11070 11140 11070 11080 +38
June HU 10320 10400 10320 10350 +47
May HO 7750 7795 7740 7790 +28
June HO 7710 7770 7665 7770 +47
IPE
June Brent 2770 2798 2760 2788 +28
July Brent 2750 2769 2735 2763 +23
May Gasoil 23400 23400 23075 23325 +250
OPEC Last Date
Daily Basket 2569 4/26
20-Day Average 2441 4/26
Consecutive Days Outside Band Within band |
