• 3 minutes Biden Seeks $2 Trillion Clean Energy And Infrastructure Spending Boost
  • 5 minutes While U.S. Pipelines Are Under Siege, China Streamlines Its Oil and Gas Network
  • 8 minutes Gazprom fails to exempt Nord Stream-2 from EU market rules
  • 11 hours China wields coronavirus to nationalize American-owned carmaker
  • 1 day Trumpist lies about coronavirus too bad for Facebook - BANNED!
  • 11 hours Open letter from Politico about US-russian relations
  • 16 hours Renewables Overtake Coal, But Lag Far Behind Oil And Natural Gas
  • 1 day China's impending economic meltdown
  • 9 hours US will pay for companies to bring supply chains home from China: Kudlow - COVID-19 has highlighted the problem of relying too heavily on one country for production
  • 2 days Why Oil could hit $100
  • 2 days Pompeo upsets China; oil & gas prices to fall
  • 2 days The World is Facing a Solar Panel Waste Problem
  • 1 day The Truth about Chinese and Indian Engineering
  • 17 hours Liquid Air Battery
  • 17 hours What the heroin industry can teach us about solar power (BBC)
  • 1 day Rational analysis of CV19 from Harvard Medical School
  • 2 days Brent above $45. Holding breath for $50??

Virus Sends Oil Shipping Rates To Asia To Lowest Since September

Charter rates for supertankers on key shipping routes from the United States and the Middle East to Asia have dipped to their lowest levels since the middle of September, because the coronavirus outbreak has started impacting oil demand in the world’s top oil importer, China, ship brokers tell Reuters.

The cost of chartering supertankers on routes to the main Asian and Chinese import hubs has now slumped to levels last seen before the U.S. slapped sanctions in September on several Chinese tanker owners for shipping Iranian oil, including units of Cosco, the ship brokers told Reuters.    

After the sanctions on Cosco, the cost of chartering supertankers to carry crude oil from the Middle East to Asia soared by double digits overnight.

On Friday, the U.S. partially lifted some of the sanctions on Cosco.  

Now the freight rates for supertankers, the so-called very large crude carriers (VLCCs), are down to their lowest since the middle of September 2019 as Chinese refiners grapple with weakening fuel demand at home and elsewhere in Asia.  

Demand for jet fuel, gasoline, and diesel is likely to be suppressed in the coming weeks as airlines are canceling thousands of flights to and from China, and Chinese authorities are discouraging or outright banning travel in the areas most affected by the virus.

The flow of oil traveling from Latin America to China has stopped in the wake of the coronavirus outbreak, with no oil making its way from Brazil or Colombia to China in more than a week, Bloomberg reported last week.

Sinopec, the largest oil refiner in Asia, is cutting its refinery production by 600,000 bpd in February, due to decreased fuel demand amid the outbreak, while independent Chinese refiners have already cut run rates by as much as 30-50 percent and now operate at less than half of their refining capacity, sources familiar with the plans told Reuters on Monday.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News