Platts: Rise in West African Crude Flow to India to Boost Suezmax Rates: Shipbroker

“Freight rates for Suezmaxes are rising due to strong demand for shipping West African grade crude to India and may rise further as older ships are scrapped as well as on potential crude exports from the US, shipbroker Poten and Partners said in a report released over the weekend. “The number of cargoes moving from West Africa to Asian destinations has more than doubled to 15 in November from less than six a month in 2012, the report said. “On the supply side, the thin order book for Suezmax vessels relative to number of vessels that are 15 years or older is bullish news, Poten said The current order book for Suezmaxes is a notch above 10% of the 440-ship fleet; however, 13% of the fleet is 15 years or older. “Another possible boost for Suezmax market is the possibility of US exporting crude oil. If such exports are authorized, due to the limited number of ports in the US Gulf that can handle VLCCs, the oil will likely move via Suezmaxes or Aframaxes, the report said. “In such a scenario, the additional cost of rail transportation might again make the seaborne grades from West Africa an attractive option for US refiners, the report said.”