Middle Eastern and Asian Companies Buy Up Old Tankers for Shipping Russian Oil

  • The tanker charter price is sky-high for vessels that are willing to transport Russian oil despite the sweeping sanctions.
  • Middle East and Asian buyers are looking to purchase aging oil tankers in order to ship Russian fuel.
  • This year, the prices for Aframax tankers aged 20 years have nearly doubled.

Sweeping sanctions, boycotts, and restrictions on Russian oil have spurred opportunistic profiteering — market entrants are now snapping up aging oil tankers to ferry the fuel at a premium rate.

New ship owners, mainly from Asia and the Middle East, are looking at sky-higher charter rates for tankers that will transport Russian oil to Russia. India and China, ReutersMonday’s report. India and China are now major buyers of the fuel after the European UnionOn December 5, the Russian government lifted its ban on imports of seaborne Russian crude oil.

An unnamed ship broker said that ships earning $80,000 per day in the Mediterranean could make $130,000 per day if they carry Russian crude oil. That’s as crude tanker rates have soared this year to their highest level since 2008 — other than a brief spell during the pandemic in 2020 when oil companies used the ships for storage of excess supply as demand slumped, per Reuters’ records.

The possibility of huge profits has also driven the prices for second-hand oil tankers sharply up.

Prices for 20-year-old Aframaxes —  the standard vessel size used for loading crude at Russian Baltic ports — have surged 94% from $11.4 million in January to nearly $23 million as of November 24, shipping data provider VesselsValue told Insider.

There have also been 161 Aframax sales so far this year — 5% more than the 153 sold in the same period in 2021, according to VesselsValue.

Five Aframax tanks were bought by a Chinese shipowner. Lloyd’s ListThis report was published in August.

According to the shipping journal, the buyer spent $376 million on 13 tankers of various sizes in order to ship-to-ship transfer of Russian crude oil in Atlantic Ocean. All the ships were at most 15 years old, and most of them were bought between May and July 2022.

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