The support is provided by a network of port chaplains who have undergone traumatic incident response training.
By MarEx 2015-07-03 08:51:08
The monthly average for the first six months in 2015 is 3.3m DWT. In 2014 the first half year averaged at 1.33m DWT per month.
April 2015 saw 5.36 million DWT being retired from active service, which was the highest on record ever for a single month. The record came on the back of continued poor earnings and deteriorating market conditions in dry bulk shipping, evidenced by the Baltic Dry Index (BDI) staying below 600 from 2 February to 13 May.
In 2012, which is the largest demolition year on record with 33.4m DWT leaving the fleet, the monthly average was 2.79m DWT. So could we be heading for an even higher level in 2015? The preliminary amount of dry bulk tonnage being demolished during the first half of 2015 is 20 million DWT. During the first half of 2012 we saw 18 million DWT leaving the fleet.
Chief Shipping Analyst at BIMCO, Peter Sand, Says: “As the year progresses, BIMCO expects the demand side to get stronger in connecting with rising volumes. This should positively impact the market conditions but at the same time also limit the demolition activity.
In line with our recent adjustment of expectations for demolition activity in 2015, we do not see a new record year in spite of the strong start of the year.”
In the BIMCO news piece Busiest Capesize Demolition Market Ever from 7 May a total of 52 Capesizes had been demolished. Today that number has increased to 68. The record from 2012 where 70 Capesizes were demolished during the full year will soon fall.
The Handysize segment was the busiest sub-segment in all of the six months when you measure activity by number of ships being recycled. A total 104 Handysizes have left the fleet for good so far in 2015. The total number of dry bulkers being demolished now stand at 262 ships for the year.
It remains to be seen if Handymax demolition activity will remain subdued. The fleet growth is the largest amongst the dry bulk-segments as newbuilt Supramaxes keep coming from the shipyards. However, earnings have out-performed all the other dry-bulk segments from mid-February to end of June, leaving little reason for engaging more often with the blow torch for Handymax owners.
“The relatively low level of Handymax scrapping is a testament to a versatile sub-segment which is able to deliver what the market wants even when the overall demand side is losing ground. Fleet growth for Handymax/Supramax segments stand at 3.5% since the turn of the year”, adds Peter Sand.
By Reuters 2015-07-03 08:37:37
U.S. crude stocks unexpectedly rose by almost 2.4 million barrels last week, breaking a run of eight consecutive weekly declines and sending oil prices sharply lower.
But did the market overreact when the stock numbers were released on Wednesday – misinterpreting normal week-to-week variability in the data as a fundamental shift in the balance between supply and demand?
Tanker arrivals create quite a bit of “noise” in the weekly inventory data which can easily be confused with shifts in the supply-demand balance over short periods.
Reported crude stockpiles are driven by three factors: domestic crude production, crude imports, and refinery runs. Domestic output is fairly constant week to week, but imports and runs are highly variable.
In 2014, U.S. refineries processed an average of 15.8 million barrels per day (bpd).
Domestic crude production was around 8.7 million bpd in 2014 and the country imported around 7.3 million bpd of crude, according to the Energy Information Administration.
Almost 3 million bpd of imported oil arrived by pipeline or train from Canada, while most of the remaining 4.5 million bpd from other destinations came by tanker.
The typical very large crude carrier (VLCC) or supertanker employed in long-distance voyages carries around 2 million barrels of oil. So, the United States receives the equivalent of two to three VLCC cargoes per day or around 15-16 per week. Imported crude is reported only once it has been cleared through U.S. Customs.
But there is significant variability around these daily and weekly averages. The timing of individual tanker arrivals and completion of customs formalities therefore has a major impact on reported imports for a given week.
Charts one to three, which show weekly imports of crude between 1983 and 2015, make the week-to-week variability apparent.
From one week to the next, imports can vary by up to 2.5 million bpd or as much as 15-20 million barrels per week.
The one-week change in imports has a standard deviation of almost 750,000 bpd or about 5.2 million barrels per week.
Fluctuations in imports, as much as refinery runs, have a major impact on the one-week reported change in stock levels.
This is what seems to explain the sudden rise in inventories in the week to June 26.
Crude stocks rose by 2.4 million barrels, compared with a decline of 5.0 million barrels the previous week, and an average decline of 3.5 million barrels over the prior eight weeks.
Refinery throughput was almost exactly unchanged from the previous week at a near-record 16.5 million bpd.
The entire stock change seems to have come from a big boost in imports, which rose by almost 750,000 bpd or 5.2 million barrels per week.
The increase in imports, and reported turnaround in stocks from a 5-million-barrel drawdown to a build of 2.4 million, was well within the normal variability for both the import series and reported inventories.
While it could signal an increasing surplus of supply over demand, it may simply be due to the timing of tanker arrivals, and there is no way to distinguish between the two at a one-week level.
The market’s swift response – sending U.S. oil prices down more than $1.50 a barrel to close at the lowest level for more than two months – therefore looks like an overreaction.
By John Kemp
The opinions expressed herein are the author’s and not necessarily those of The Maritime Executive.