Reuters
https://www.reuters.com/article/us-global-oil-tankers-storage/oil-barrels-come-off-the-water-as-storage-boom-at-sea-fades-idUSKBN2425OP
LONDON (Reuters) - Tens of millions of barrels of crude and oil products
stored on tankers at sea due to the coronavirus crisis are being sold,
in a sign fuel demand is recovering as lockdowns ease, shipping sources
say.
Fuel demand tumbled as much 30% from March to May, with some surplus stored at sea as land storage filled up.
Crude
held on tankers fell below 150 million barrels by the end of June, down
from more than 180 million barrels in late April, IHS Markit estimated.
Refined products held on vessels dropped to 50 million barrels
from a mid-May peak close to 75 million barrels, IHS said, adding
gasoline stocks were the fastest to be offloaded.
“Volumes shown under floating storage can potentially drop rather
fast during July,” Fotios Katsoulas of IHS said, adding there were
several tankers off China waiting to discharge.
Demand for
floating storage at the peak of the crisis was helped by a market
contango, a price structure where cargoes for delivery in the shorter
term are cheaper than those for later delivery, encouraging traders to
store fuel until prices pick up.
As the contango has narrowed with rising demand, there is less incentive to store fuel.
In
addition, OPEC, Russia and other allies, a group known as OPEC+, have
curbed production and output from the United States and elsewhere has
fallen, leaving less surplus oil to keep at sea, a more costly
alternative to onshore storage.
“With output levels lower, this has reduced the need for storage on
land and combined with a reduction in price contangos, there is less of
an incentive to store crude at sea,” said Rebecca Galanopoulos Jones,
with broker Alibra Shipping.
Clarksons Research estimated 218
million barrels of crude was held on tankers by June 26 from a peak of
290 million barrels in early May, while about 70.5 million barrels of
oil products were stored versus a May peak of 100 million barrels.
“We
believe floating storage is going to gradually decline from now and
reach normal levels sometime during the autumn,” a spokeswoman with
shipping group NORDEN said.
Editing by Dmitry Zhdannikov and Edmund Blair
Our Standards:The Thomson Reuters Trust Principles.
Very informative article, which you have shared here about the oil shipping. After reading your article I got very much information and it is very useful for us. I am thankful to you for sharing this article here. Freight Brokers Brisbane
ReplyDeleteThanks for sharing such great information. It's really helpful for me. I always search to read the quality content and finally I found this in your post. keep it up. Air Freight Forwarders
ReplyDeleteYou have shared a nice article here about the shipping. Your article is very informative and nicely describes the causes and natural remedies of Snoring. I am thankful to you for sharing this article here.shipping from china to fba
ReplyDelete