MOTIVAting Trade Patterns

For the past year, discussions of the Arabian Gulf to United States VLCC market have been largely focused on deciphering the true monetary returns to ship owners who embark on this 80 day round trip gamble. Languishing crude oil demand in the United States has sapped volume from the trade while roundtrip time charter equivalent earnings have been negative. A recent resurgence in crude oil movements, however, highlights an upcoming structural change that could help lend vital life support the VLCC market by creating a new element of sustainable westbound demand. Motiva Enterprises is due to expand their existing Port Arthur, Texas facility by 325,000 barrels per day with a reported start-up during in the first quarter of 2012. Download here