Forced to Store Fuel at Sea, Oil Refiners at Breaking Point
- Smallest tankers earn almost $114,000 a day in Mediterranean
- Supply chains being disrupted by delays unloading cargoes
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Oil refiners are hunting for vessels to store jet-fuel and gasoline that nobody is buying, sending freight rates sharply higher, an indication that the global refining system is fast approaching a breaking point.
Until now refiners had mostly been storing unwanted product on site, but the latest indication from the tanker market suggests they are now being forced to place their output into ships. With local demand sharply down, if they can’t find storage, they’ll be forced to trim output, or even shut down completely.