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Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: Johnny Canuck who wrote (42575)	7/26/2005 2:26:41 PM
From: Johnny Canuck	Read Replies (1) \| Respond to of 70162

12:32 Floor Talk: Tankers The NYMEX started offering two futures contracts for trading beginning yesterday for shipping tankers/freight, and the move could be seen as a potential positive catalyst for stocks in that space. Feedback from our energy contacts is that tanker co's could use these futures as a tool to hedge their shipping rates (who better to hedge the futures than the companies who operate in the space). Currently, co's such as Teekay Shipping (TK) use forward freight agreements as a hedge, so the new futures contracts should only give the co additional options to offset changes in the spot market rates. Another point we'd like to make is that co's such as TK should continue to benefit from strong shipping demand from other parts of the world. This belief was confirmed earlier on VLO's conference call, as mgmt said they will need higher imports to meet growing demand. Also, Royal Dutch Shell recently said that it led all charterers w/ 119 booked vessels that could carry 2 mln barrels each from the Persian Gulf and Red Sea to U.S., Asia, and European refineries as increased output is necessary to fill growing global demand. The global E&P's have been booking VLCCs in order to meet transporation needs ahead of seasonally strong 2H05 of the year. VLCC's (such as FRO and TK) carry 47% of all oil transported by sea. Increased production has also kept demand strong.