ECONOMY

Crude freight rates sink after news of OPEC supply cuts

LONDON (Reuters) – Crude oil freight rates fell further on leading export routes yesterday, in a counter-seasonal fall, after OPEC delegates said the group planned to cut supply for the first time since 2004. Leading oil tanker company stocks also softened on the news, but crude freight derivatives markets failed to react, with some brokers saying the bearish news had already been factored in. The benchmark Gulf to Japan very large crude carrier (VLCC) route fell to an average of W82.50 yesterday, a four-month low. Single-hulled ships were trading lower at W75 and double-hulled vessels at W90 on the same voyage. «We could be saying goodbye to the winter market here. I know it’s negative but you really do have to be realistic,» one senior ship broker said. Other leading global export routes for crude, out of West Africa and the Mediterranean, also turned negative on Thursday and came under more pressure yesterday, with most classes of tanker affected. Leading tanker oil stocks also reacted to bearish signals on future demand with shares in firms like Norway’s Frontline and Greece’s Tsakos Energy Navigation softening.