By PRIYANKA SHARMA
Traders booked the most tankers in eight months to ship
diesel and heating oil to Europe from the US Gulf, where refining
is surging as a
consequence of Americas rising crude production.
Oil companies either booked or plan to charter 16 tankers to
transport cargoes on the route for loading during the next
two weeks, according to the survey of six people involved in
the trade yesterday. That compares with nine last week and is
the highest count since Nov. 6.
The highest US oil production in more than two decades means
Gulf Coast refineries are processing close to the most fuel
ever. A ban on exporting most crude means the nations
plants can tap cheaper supplies than their Europe
an counterparts. Tankers
taking those refined fuels across the Atlantic Ocean are
earning the most for the time of year since at least 2012.
There has been a strong increase of product being
shipped from the Gulf Coast to Europe, George Los,
senior market analyst Charles R. Weber Co., a shipbroker in
Greenwich, Connecticut, said by e-mail. The month is on
course to conclude at a record high.
West Texas Intermediate crude, the US grade for which futures
are traded in New York, costs about $5/bbl less than Brent,
the benchmark for plants in Europe, according to data on the
ICE Futures Europe
Refineries in the Gulf of Mexico processed 8.62 million bpd
of crude in the week to July 18, the highest for the time of
year in Energy Department data starting in 1992. The all-time
high was 8.65 million bpd on July 4. Total US refining
rates of 16.81 million
bpd are also close to a record.
Tankers on the trade route to Amsterdam from Houston earned
$12,106/day Wednesday, according to data from the Baltic
Exchange, a publisher of freight prices based in London.
Thats the highest for the time of year since at least
Derivatives to hedge July-to-September freight costs on the
route traded at about $26 a metric ton yesterday, compared
with as less than $20 a ton at the start of June, according
to the exchanges data.
The 16 ships are known as Medium Range tankers, for which
standard cargo sizes are 38,000 metric tons. That implies
exports of about 325,000 bpd. Nine of the charters have
already been arranged and seven are anticipated cargoes.
While shipments to Europe
from the US are
accelerating, those in the opposite direction are in decline.
Traders hired or plan to hire 17 ships for the trade route,
four fewer than the same week in 2013 and the least for the
time of year since 2012, Bloomberg