Industry

Shipping is essential to the functioning of the global economy and its dependence upon transporting goods from the production to the consumption sites. Seaborne transport represents the 90% of the volume of the world trade. Oil and its products together with coal are components of the major seaborne trade commodities. In recent years, quality and safety standards pertaining to the seaborne transportation have been raised significantly and more stringent regulations are ratified.

Crude Oil

Oil is a commodity of key strategic importance. Approximately 45% of the world crude oil production is being transported by tanker vessels, carried through fixed maritime routes.

Daily charter rates are highly dependable on the balance between supply and demand. The growth in tanker demand over the years is primarily driven by the increase in worldwide consumption deriving mostly from the world industrial economies, the import dependency in the major consuming regions and longer voyage lengths from production origins to receivers. Each maritime route entails particularities that depict to the size and type of transporting tanker vessels.

VLCCs are trading on long length voyages; Suezmax tankers usually in the Atlantic basin; Aframaxes are used in more diversified trades due to their flexibility and carrying capacity and Panamaxes in trading routes transiting Panama Canal and calling in restricted water depth areas.

Clean Products

Products Produced From a Barrel of Oil

The products trade is more complex than the crude oil trade as it contains a wide range of products refined from crude oil , whose colour is less than or equal to 2.5 on the National Petroleum Association scale. While the crude oil trade covers refinery inputs, the petroleum products trade transports the output of the refineries. Clean products include naphtha, jet fuel, gasoline and diesel / gas oil and thus a larger base of production sites and importers worldwide.

Coal

Coal is a global industry and a very important source of energy with coal mined commercially in over 50 countries and imported in over 70. There has been a 38% increase in production over the past 20 years and it is expected to reach to 7 billion tonnes in 2030. It is a commodity readily available from a wide variety of sources. Australia is the largest coal exporter globally. Seaborne trade is served by vessel types illustrated in the table below:

The degree of change a coal undergoes as it matures from peat to anthracite known as coalification is directly related to its physical and chemical properties defined as “rank”. Low rank coals such as lignite are soft and have earthy appearance. High rank coals are hard and commonly black in colour. Anthracite is at the top of the rank scale.

Markets for steam coal, meaning the coal with relatively high sulphur content, suited for generating steam are divided to two regions:                                                                          

• The Atlantic market, consisting of importing countries in Western Europe and
• The Pacific market, comprising of developing and OECD (Organization for Economic Co-operation and Development) Asian importers.
• Coking coal is defined as hard coal with a quality that allows the production of coke suitable to support a blast furnace charge.                                                                                     
• International coking trade is a more uniform world market reflecting the small number of supply countries influenced by crude steel production which in turn is largely dependable on the overall state of economic conditions.