<<<<<ANOTHER CARIB VOYAGE by: The_Masked_Investor 05/27/06 10:26 am Msg: 113856 of 113914
The Front Force is headed Caribs to Singapore for $5.2 million.
Out of curiosity I scanned December '05 and January Platou fixture records for the Caribs routes. Looks to me like the Caribs to the far east routes are a growing phenomenon. It doesn't make any economic sense, but I think Venezuela is hell-bent on not selling their oil to the US. So instead they are shipping it to the far east via VLCC. The US will need to replace this oil with crude, most likely from the Middle East or Africa. I wonder if the analysts have included this development in their tanker forcasts?
That's potentially a significant increase in voyage miles to move the same amount of product.
BTW, I'm very happy we beat Venezuela in the WC soccer match last night.>>>>>>
<<<<<<Re: ANOTHER CARIB VOYAGE by: conch111w2 (78/M/Fla Keys) 05/27/06 01:57 pm Msg: 113864 of 113914
You posted "Front Force headed for Singapore for $5.2mm"
Also consider Front Crown lifting 8 June for Singapore at $5.5mm.
Some of us have been playing with these Caribs fixtures, mainly having to figure steaming times based on great circle distances. Interestingly, these voyages are routed via Cape Town, since wind and tide conditions are not considered favorable for trips "around the Horn".
Our estimates have settled in at 59 days for the trip to Singapore, giving us a return of $88,000/day each, for these two fixtures!!
Also, consider the Front Vangard lifting 25 May for China at $6.45 mm, and the Front TBN(to be named) VL lifting 10 June, also at $6.45mm.
Figuring this voyage at 70 days, we are getting around $92,000/day!!
This could be even sweeter, since, obviously, managers will be figuring a ballast trip from Singapore, or China, back to the AG for another run!!
The only fly in this ointment is the fact that the voyage times/distances are not firmly established, at least from any information we can gather.
However, our numbers have to very close, but we would very much like to hear from anyone with authorative established voyage times, which could change the numbers somewhat. (The trip times were based on an average speed of 15 knots.)
It would be very informative if an expert(Laph,F7,or other) would weigh in on this. I, for one, feel it to be very important for future earnings.
Don't forget to take $10k or $15k per day for expenses (crew, bunkers, insurance, etc.) out of that $88k or $92k per day to get closer to TCE numbers. The real TCE is probably not more than $60k/day for the Caribs to East trips.
Now that I think about it, just take FRO's published break even rates of about $28k/day and you'll get $50k to $60k per day in profits? (Assuming the break even rates include all expenses -- including bunkers.)
This is clearly the case. It has been known for a while that China and Venezuela have been working together on a scheme to increase oil export from Venezuela to China. According to the Caracas government, China should be receiving some 300,000 b/d of Venezuelan crude and products by year-end, double the 150,000b/d it receives today.
This is important for several reasons: 1) China needs the oil. 2) Venezuela needs to diversify its client base from the U.S to Asia. 3) Venezuela will get some wider infrastructural investment projects as part of the deal.
Venezuelan oil company PDVSA has signed a deal to build 18 oil tankers in China, and will increase the fleet with as many as 42 new tankers for the Asia trade.
Until they are built, they will use spot market freight capacity. That�s why you see so many Frontline fixtures from the Caribbean to China.
laphno, its all politics. By shipping to China, there is not necessarily a quality diversification taking place. Venezuela gets much of their refined products from the US. By diversifying to China, Venezuela becomes more beholden to the US. china won't be shipping much refined product to Venezuela. They need all they can produce.