A flag with the Organization of the Petroleum Exporting Countries (OPEC) logo is seen during a meeting of OPEC and non-OPEC producing countries in Vienna, Austria September 22, 2017. REUTERS/Leonhard Foeger Photo: Reuters
Cuts in OPEC output that have led to a surge in U.S. oil exports to Asia may prove a godsend for struggling global shippers, driving rates for large crude shipments to China, India and other major oil importers sharply higher over the next year.
Operators such as Frontline Ltd (FRO.OL), Euronav (EUAV.BR) and Gener8 Maritime (GNRT.N) are still recovering from five years of weak rates and falling profits, and face more financial headaches after a glut of new supertanker launches.
But OPEC’s strong compliance with output cuts agreed in 2016 is boosting prospects for the business by raising demand for previously little-used U.S.-Asia routes and allowing tankers to refill in the Gulf on return journeys to the United States.