Friday, January 30, 2009
Ship Investor Nobu Su Offers 20 Supertankers to Oil Speculators
Friday, 30 January 2009
Shipping investor Nobu Su plans to offer his fleet of 20 supertankers to speculators to store crude and bet that prices will appreciate later in the year. Su's Taipei-based company, TMT Co. Ltd., will lease out its 2 million-barrel vessels at below-market prices in return for a share of any profit from the trade on the oil. His fleet, able to hold enough crude to supply Europe for two days, is available for immediate hire, he said.
"The oil price is very cheap," Su, founder and chief executive officer of TMT, said in an interview in London yesterday. "We get a lot of enquiries" about storing cargoes, he said.
Oil companies such as BP Plc and banks including Citigroup Inc., through its Phibro LLC unit, have stored as much as 80 million barrels of crude at sea, seeking to profit from the fact oil futures rise as the year progresses. The price curve is described as being in contango when futures are more expensive than immediate supplies.
Rather than seeking traders wanting to lock in a profit now from the difference between immediate supplies and futures prices, Su is marketing his vessels to investors willing to wait several months before selling the oil on the market, he said.
TMT will help investors secure cargoes by introducing them to oil traders, Su said. TMT may store some cargoes in the Persian Gulf at cheaper prices on its four single-hull supertankers and deliver them in vessels with two hulls, he said.
The average price of storing 2 million barrels of oil on a tanker is about $57,500 a day, depending on the duration of the contract, the quality of the ship and its location, according to data from London-based shipbroker Galbraith's Ltd. That works out at 86 cents a barrel a month.
Source: Alaric Nightingale, Bloomberg
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