VLCC hire rates are likely to go up on account of higher demand triggered off by lower crude prices.
8It is expected that oil demand growth will accelerate in coming years, and the forecast is of an increase of 1.6 to 1.8 MMB/d for the 2015 and 2016, which will benefit the oil tanker business.
8Moreover high Mid East OPEC crude production has always supported the VLCC earnings. During the first quarter, where oil production from Mid East increased from 22.25 million bpd to 23 million bpd, VLCCs also showed an increase in their spot prices which from $ 50000 per day to $ 65000 per day.
8Output from Non OPEC countries also bring in a positive push, as production is expected to grow at a steady rate, touching 60 million bpd mark by 2019.
8The shipping business is now expected to sail comfortably as a consequence of higher output.
8There are however certian trade shifts which occurred on a global level but that is unlikely to affect the shipping industry. Among the shifts are:
-- USA no longer imports light crude but its heavy crude imports from Middle East remain intact.
-- Asian demand is said to remain strong which is underpinned by China’s efforts at expanding refinery capacity and filling up strategic reserves.
-- WAF (West Africa) light crude trade lane to USA has dried up and it has shifted its attention to Asian markets.
For more details visit indianpetroplus.com
8It is expected that oil demand growth will accelerate in coming years, and the forecast is of an increase of 1.6 to 1.8 MMB/d for the 2015 and 2016, which will benefit the oil tanker business.
8Moreover high Mid East OPEC crude production has always supported the VLCC earnings. During the first quarter, where oil production from Mid East increased from 22.25 million bpd to 23 million bpd, VLCCs also showed an increase in their spot prices which from $ 50000 per day to $ 65000 per day.
8Output from Non OPEC countries also bring in a positive push, as production is expected to grow at a steady rate, touching 60 million bpd mark by 2019.
8The shipping business is now expected to sail comfortably as a consequence of higher output.
8There are however certian trade shifts which occurred on a global level but that is unlikely to affect the shipping industry. Among the shifts are:
-- USA no longer imports light crude but its heavy crude imports from Middle East remain intact.
-- Asian demand is said to remain strong which is underpinned by China’s efforts at expanding refinery capacity and filling up strategic reserves.
-- WAF (West Africa) light crude trade lane to USA has dried up and it has shifted its attention to Asian markets.
For more details visit indianpetroplus.com
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