Nordic American Tankers Ltd (NAT)

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U.S.-to-Asia oil shipping rates soar to three-year high

Reuters

Oct. 2, 2019 10:31 AM ET|

About: Frontline Ltd. (FRO)|
By: Carl Surran, SA News Editor

Freight rates for U.S. crude tankers bound for Asia jumped to the highest in more than three years this week as U.S. sanctions on a China's COSCO cut vessel availability.

The U.S. last week imposed sanctions on two COSCO units for alleged involvement in ferrying crude out of Iran, which caused U.S. Gulf Coast exporters to hold back chartering COSCO-linked tankers.

This week, suggested rates for VLCCs from the Gulf Coast to China surged to $9.8M from $6.2M in early September, Reuters reports.

The surge in freight costs has narrowed the window to profitably export U.S. crude to Asia and left some U.S. crude exporters reluctant to book vessels at the higher rates, which traders say could limit November loadings and exports unless more vessels become available in coming weeks.

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