2025.01.17

Oil Prices Dip on Potential Ceasefire in Red Sea and Strong U.S. Retail Sales Data

Oil prices settled lower on Thursday as Yemen's Houthi militia is expected to halt attacks on ships in the Red Sea, while strong U.S. retail sales data complicates the outlook for Fed rate cuts. Brent crude settled at $81.29 per barrel, down 0.9%, and U.S. West Texas Intermediate crude settled at $78.68 per barrel, down 1.7%. The ceasefire deal in Gaza between Israel and Hamas has also eased concerns. Fed governor Christopher Waller's comments hint at a possible rate cut. Sanctions on Russia are impacting global oil markets. Investors are waiting to see how President-elect Trump will address the sanctions. OPEC+ is likely to be cautious about increasing supply despite the recent price rally.

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Middle East Oil Prices Surge as Chinese and Indian Demand Soar Amid Sanctions on Russian and Iranian Supplies

Middle East oil prices have surged due to strong demand from China and India following sanctions on Russian and Iranian supplies. Qatar's ALS term price in March hit a 2-year high, with premiums for Mideast benchmarks exceeding $4 per barrel. Indian Oil Corp issued its first sour crude tender since March 2022, while Unipec and Sinochem made significant crude purchases. The Biden administration's sanctions on Russian producers have led to a scramble for alternative oil supplies, driving prices up.

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US Sanctioned Tanker Discharging Russian Oil in China Despite Restrictions

According to Sources, a tanker under US sanctions is discharging Russian oil at a port in Shandong province, China. This is the first tanker to do so since the new sanctions were announced. The industry is closely watching to see how strictly the measures will be enforced. The sanctions allow a grace period for cargoes loaded before Jan. 10 and unloaded before March 12, causing some disruptions in shipments. The tanker, Mermar, is among 183 ships designated by the Biden administration, and it is considered part of Russia's shadow fleet used to bypass sanctions. The vessel is managed by Ocean Anemone Shipmanagement, insured by Balance Insurance based in Russia. Shandong Port Group had already banned US-sanctioned tankers before the sanctions announcement.

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Experts Anticipate Yemen's Houthi Militia to Halt Attacks on Ships in Red Sea Following Ceasefire Deal

Maritime experts are expecting Yemen's Houthi militia to cease attacks on ships in the Red Sea following a ceasefire deal in Gaza. The group has postponed a security briefing and its leader is due to speak, raising speculation of a possible pause in attacks. The Houthis have carried out over 100 attacks in the Red Sea, causing disruptions and expensive detours for shipping companies. Maritime security officials believe that a ceasefire announcement is likely, but it is still too early to confirm. The Houthis' decision to delay the security briefing suggests a possible change in their tactics. The expectation of a halt in attacks has led some companies to consider resuming Red Sea journeys, with hopes that insurance fees will decrease once business returns to normal.

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Experts Anticipate Yemen's Houthi Militia to Halt Attacks on Ships in Red Sea Following Ceasefire Deal

Maritime experts are expecting Yemen's Houthi militia to cease attacks on ships in the Red Sea following a ceasefire deal in Gaza. The group has postponed a security briefing and its leader is due to speak, raising speculation of a possible pause in attacks. The Houthis have carried out over 100 attacks in the Red Sea, causing disruptions and expensive detours for shipping companies. Maritime security officials believe that a ceasefire announcement is likely, but it is still too early to confirm. The Houthis' decision to delay the security briefing suggests a possible change in their tactics. The expectation of a halt in attacks has led some companies to consider resuming Red Sea journeys, with hopes that insurance fees will decrease once business returns to normal.

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Sinokor Maritime Secures Term Cover in VLCC Market amid Rumors of Tie-Up with Trafigura's Tanker Fleet

South Korean owner Sinokor is reportedly securing more term cover in the VLCC market and there are rumors of a potential tie-up with Trafigura's tanker fleet. Sinokor has chartered two tankers (Almi Titan and Almi Atlas ) from Greek shipowner Almi Tankers for three years at a rate of $47,500 per day. This comes amidst reports of discussions between Sinokor and Trafigura to collaborate on VLCC operations. Trafigura has fixed a vessel for 10-14 months in Asia at $38,500 per day. Spot rates for VLCCs are on the rise due to US sanctions on shadow fleet tankers. The suezmax and aframax period charter sectors are quiet, while MR tankers are more active in term-charter markets. Greek shipowners have fixed out LR2 product tanker newbuildings, with Atlas Maritime chartering the Stavanger Star to Trafigura and Chandris (Hellas) chartering a dual-fuel vessel to Total. Rates are stabilizing but it depends on the location for owners to achieve favorable levels.

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