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By Florence Tan and also Roslan Khasawneh SINGAPORE, Sept 10 (Reuters)– Oil significant BP has actually provisionally hired a supertanker to keep petroleum off Malaysia at this year’s cheapest price yet, according to sector resources and also information on Refinitiv Eikon.

The charter is the most recent in a flurry of ship reservations made by oil majors and also trading residences after vessel prices dove. A rebirth in coronavirus situations, inadequate climate and also completion of the north hemisphere’s summertime driving period have actually slowed down international oil profession and also delivery need.

BP hired huge unrefined service provider (VLCC) Gene at $20,500 daily for 3 months and also has the alternative to prolong an additional 3 months at $22,000 daily, among the resources claimed.

“It is the cheapest rate so far,” he claimed.

BP decreased to comment. The resources decreased to be called as they are not licensed to talk to media.

The vessel is anticipated to come to Linggi port on the west coastline of peninsular Malaysia in the future Thursday, information on Refinitiv Eikon revealed.

The day-to-day price for hiring VLCCs for 6 months struck a high of $120,000-$ 130,000 in April as investors hurried to keep oil for later sales after a collapse in oil costs and also need in the 2nd quarter. More than 1 billion barrels of oil went into storage space over the 2nd and also 3rd quarter.

The trading technique, referred to as a contango play, counts on a large spread in between timely and also future months to cover storage space expenses.

Such storage space plays are beginning to look “marginally open”, a Singapore- based unrefined investor claimed.

However, Citi experts claimed: “Much of the recent temptation to lease vessels for storage reflects more the decline in freight rates than a return to super contango.”

Ashok Sharma, handling supervisor of Singapore- based shipbroker BRS Baxi, claimed the leases are much more like changing “expensive tonnage chartered earlier in the year … with cheaper tonnage.” (Reporting by Florence Tan and also Roslan Khasawneh; Additional coverage by Shu Zhang; Editing by Jacqueline Wong and also Tom Hogue)

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