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Lloyds List: Nigerian troubles worrying brokers

Martyn Wingrove
Feb 23, 2006
NIGERIAN oil export problems could knock back otherwise strong tanker markets if lower output continues in the medium term.
Royal Dutch Shell has shut in 455,000 barrels of oil per day of production and exports after militant attacks damaged tanker loading facilities. The Anglo-Dutch oil major also extended force majeure on exports from the Forcados and EA terminals, leaving tankers idle without cargoes. Brokers fear a a long period of downtime at these terminals or any attacks on other export facilities could force shipowners to move their tankers around Africa to the lucrative Middle East.
'How long the Nigerian situation lasts will determine how rates in the Atlantic and Middle East markets are affected,' said a London-based broker.
'The Middle East market is looking healthy and owners don't want to see tankers cruising around the Cape [of Good Hope] to swell the market.'
The market is motoring along nicely for owners and would turn back in favour of charterers if more tonnage becomes available.
This week, charter rates for very large crude carriers have remained firm despite quiet fixture activity.
Brokers said rates for VLCCs taking Middle East crude to Japan were around W115 and those making tracks to Singapore are being fixed for W130.
Brokers reported that South Korean refiners booked NYK's 1994-built, 264,457 dwt Takayama at a rate of W117.5 to carry a Middle East crude cargo.
'The market is not terribly busy, although reasonably good, but more ships competing in the Middle East market could drive rates down,' the London broker said.
Oil companies are booking VLCCs at rates of around W115 to take Middle East crude to the US, but most of the fixtures have been for voyages across the Indian Ocean.
Rates to the US west coast are about W142.5 as shown by BP booking 2002-built, 308,875 dwt Front Falcon at this rate, although this fixture was seen to be at a premium by brokers.

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