June 1, 2006	Thursday	Jumadi-ul-Awwal 4, 1427

LONDON, May 31: Crude oil freight rates from the Gulf to global refiners rose on Wednesday, but voyages from other key exporting centres like West Africa and the Mediterranean fell, shipping brokers said.

They said Very Large Crude Carrier (VLCC) freight rates from the Gulf to Japan and Singapore firmed about four points to W83 and W88, respectively, though double-hulled units were still paying a sizeable premium on the trades.

Freight futures prices on the Gulf to Japan VLCC route last traded at W85 in June and W83 in July according to Norway’s International Maritime Exchange.

VLCC rates from the Gulf to the United States were about 2.50 points higher at W75.50.

“There are mixed brokers views for June business, with some seeing a plentiful supply of tonnage in the Middle East Gulf which they expect will weigh on freight rates,” Simpson, Spence and Young consultancy said in a report.

Despite the cyclical dip in the second quarter, rates on many main voyages are still considerably higher than at this time last year.

And time-charter, or period rates, are still paying way over break-even for owners with typical VLCCs earning $37,600 per day between the Gulf and the US.

Rates have been steadily edging higher and are now at two-month highs on major routes. However, prices are still way down on highs struck in late November, ahead of peak winter demand for heating oil, when Asian routes struck over W230.

Brokers and analysts say slow second quarter demand when refineries are traditionally in maintenance, an abundance of single-hulled tankers and a growing world oil tanker fleet continue to pressure prices.

Million-barrel ships, 130,000 tankers, trading between West Africa and the USA were averaging $45,600 per day.—Reuters