Surging freight rates mean U.S. crude no longer competitive in Asia
Traders say the economic incentive to import oil from the U.S. Gulf Coast to Asia has closed, as the cost of booking supertankers on the route has surged, Reuters reported Wednesday.
The freight rally has raised the premium for West Texas crude from the U.S. to more than $4/bbl against Dubai quotes on a cost-and-freight basis for April delivery from ~$2/bbl last week, traders said, reportedly pushing WTI to a premium of $1/bbl more than Murban crude from the United Arab Emirates - which is somewhat similar to WTI - for delivery to Asia, up from parity or a small discount last week.
Potentially relevant stocks included Frontline ( $Frontline PLC(FRO.US$ ), Euronav ( $Euronav(EURN.US$ ), Teekay Tankers ( $Teekay Tankers(TNK.US$ ), Nordic American Tankers ( $Nordic American Tankers(NAT.US$ ), International Seaways ( $International Seaways(INSW.US$ ), Scorpio Tankers (STNG), Tsakos Energy Navigation ( $Tsakos Energy Navigation(TNP.US$ ), Torm ( $Torm(TRMD.US$ ), DHT Holdings ( $DHT Holdings(DHT.US$ ) and SFL Corp. ( $SFL Corp(SFL.US$ )
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