(http://www.augustenergy.biz/, August 13, Thursday) --- Article from Reuters ...
The amount of crude oil being stored at sea has risen sharply over the last two weeks, particularly in the U. S. Gulf, due to a price incentive for oil companies to hold stocks on board vessels, traders and analysts said.
Several industry sources estimated that there were 70 million barrels of oil being stored at sea. While the estimates vary from around 60 million to 100 million barrels, most sources agree offshore storage levels rose by around 10 million barrels in the last two weeks alone.
A Very Large Crude Carrier(VLCC) can store up to two million barrels of crude oil.
An oil price structure known as a contango makes it more profitable for oil companies to store their crude rather than deliver it immediately because the price further in the future is higher.
"We have seen renewed interest in chartering VLCCs for storing crude oil of late," said Simon Chattrabhuti, head of tanker research with ICAP Shipping in London.
West Texas Intermediate crude futures for delivery next month have been discounted by $2 a barrel compared to crude for delivery in two months.
Bunker Cafe on Facebook
http://www.facebook.com/group.php?gid=88897295872
The amount of crude oil being stored at sea has risen sharply over the last two weeks, particularly in the U. S. Gulf, due to a price incentive for oil companies to hold stocks on board vessels, traders and analysts said.
Several industry sources estimated that there were 70 million barrels of oil being stored at sea. While the estimates vary from around 60 million to 100 million barrels, most sources agree offshore storage levels rose by around 10 million barrels in the last two weeks alone.
A Very Large Crude Carrier(VLCC) can store up to two million barrels of crude oil.
An oil price structure known as a contango makes it more profitable for oil companies to store their crude rather than deliver it immediately because the price further in the future is higher.
"We have seen renewed interest in chartering VLCCs for storing crude oil of late," said Simon Chattrabhuti, head of tanker research with ICAP Shipping in London.
West Texas Intermediate crude futures for delivery next month have been discounted by $2 a barrel compared to crude for delivery in two months.
Bunker Cafe on Facebook
http://www.facebook.com/group.php?gid=88897295872
No comments:
Post a Comment