Hope you have enjoyed reading our market watch sent yesterday. In case if you have missed out, please click here to read it to stay updated with crisp current shipping market information.
So, here we come out with interesting updates for the day.
Bankruptcy Surrounds Lithuanian Shipping Company for second time.
Bankruptcy & Bulker fleet are the talk of every street when it comes to dry bulk shipping. Lithuanian Shipping Co (LSC) has been ordered by a court, where five ships has been put up for sale through an Lithuanian online auction site. Out of five ships, four are moored with no cargo. The tough dry bulk shipping market has beaten the company where this is the second time that the company has filed for bankruptcy.
50 Tankers are Waiting Outside the Port of Rotterdam!
Europe’s biggest port and Oil trading hub, Rotterdam, has all its storage full of oil, where at least 50 tankers are waiting outside the port. Wondering what the oil traders are commenting on the global supply glut? Here is what Bloomberg reports say!
“This is a clear sign of the oversupply filling up storage to the brim,” Gerrit Zambo, an oil trader at Bayerische Landesbank in Munich, said by phone. “People are preferring to store oil rather than cut production. These are bearish signs.”
So is it the tanker operators feel that the cost of storing oil at sea is cheaper than to store at terminals? The global scenario is so bad that even pirates are not interested in stealing oil. Traders are taking advantage of a market contango, where forward prices are higher than current prices, by buying oil cheap, storing it and selling the commodity later. As onshore storage fills up, companies could start stockpiling at sea in a repeat of a strategy last seen in 2008 and 2009.
Most tanker operators have taken up a route around the cape to reach European ports after loading in the middle east. The fuel economy is not under spotlight as the oil is so cheap, however the emissions are a real cause of concern when the vessel burns more fuel. By this, the carbon footprint and energy efficiency is at stake.
Source: Bloomberg & Tradewinds