VLCC (very large crude carrier) freight rates from West Africa to China have fallen close to a 15-year low, shipping sources have told S&P Global Platts.
Platts spokesperson Peter Farrell said that this was due to rapid fleet growth in the active VLCC market as well as reduced crude oil output from West Africa and the Persian Gulf which reduced the volume of cargoes being exported.
“The Persian Gulf market is the largest volume [and] as exports have decreased there, pulling down freight rates, that has put pressure on other loading regions,” he said.
Additionally, Farrell noted that the fall in exports in the past year was a reflection of Angolan oil production due to technical and operational issues and a lack of upstream investment.
Platts estimates that Angolan crude oil exports will be even lower in 2018.
