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Showing posts with label Storage. Show all posts
Showing posts with label Storage. Show all posts

Saturday 10 January 2015

Plunging oil prices cause a surge in the shipping oil tanker market

There are winners and losers with the 48%+ drop in oil prices in recent times. The Shipping Industry is one winner as it is not only benefiting from lower operational costs but the oil tanker market is enjoying boom times but not from a growing transportation task.

Oil is in contango so traders and energy companies are buying and storing now in expectation of profiting from higher prices later this year. Land based storage is reaching capacity so the industry is switching to floating storage hence the surge in demand for oil tankers. In the next few months as much as 60 million barrels could soon be held in storage at sea.

Current charter rates for crude tankers is now US$35000/day and rising rapidly. This is the highest the tanker market has been since 2010. The shipping term for this practice is vessels going "Dark". This means that they effectively leave the transportation trade and instead enter the contango trade whereby they sit at anchorage brimming with oil waiting for the price to rise and then discharge their cargo.

The worlds largest oil tanker, "TI Europe", which has a capacity of 3.2 million barrels and is 380m long has gone "dark" and is off the coast of Singapore now. It was chartered by a Chinese oil trader who is waiting for the perfect time to sell her cargo.


Some forecasters believe the contango oil trade could ultimately see as much as 100 million barrels being stored at sea.

In the long term as alternative energies are favored and countries like the USA are self-sufficient for their energy needs, I wonder what the tanker market will look like then? 

We will we still see goliath vessels like the TI Europe operating or will they go the way of the dinosaurs?

All for now,

+Brad Skelton 

Tuesday 15 October 2013

4PL "us too"...and a FREE supply chain health check.

Perhaps imitation really is the sincerest form flattery. 

My team and I launched a 4PL (Fourth party Logistics) service specifically for heavy industry and major projects earlier this year. By leveraging the enormous direct knowledge and experience we have gained in owning and operating in all manner of transport operations from cranes, trucks, freight forwarding companies, customs brokerages, warehouses, storage yards and quarantine facilities we have been able to save clients millions of dollars in some instances.

Since launching this new service we have noticed competitors, large and small, saying "us too" and now advertising they are 4PL providers when indeed most of them are not or perhaps even properly understand the concept or role they need to play.

The essence of being a 4PL provider is that you are 100% neutral. To be truly neutral you must be non-asset based. This means that you do not operate your own warehouses, trucks, planes, cranes or ships. If you do then immediately you have a conflict as you will naturally favor cargo traffic for your own assets ahead delivering the best solution for the client no matter who the provider is. This is one of the keys.

The other key is a good 4PL provider must have it's own in house IT capability and systems to support it's clients logistics and supply chain management.  Off the shelf software packages that most 3PL forwarders run do not have the modules or analytical sophistication to support a 4PL supply chain strategy.

I back my team and I to find efficiency gains and cost reductions in your supply chain whether that be domestically and/or internationally. Therefore between now and the 30th of November this year I am offering a FREE 4PL supply chain health check. There are no fees for our time if we cannot find gains for you.

If you'd like to take advantage of this offer, please email or call me. Ph: +61414362707

All for now,

+Brad Skelton