Clean Freight Rates Set to Surge amid Ebola Outbreak

Freight rates for clean tankers heading from the UK continent to the West Africa could see an increase due to the Ebola crisis which was forcing shipowners to insert clauses into charter parties to avoid the risk of their vessel being quarantined, shipping sources told Platts.

The inserted clauses relate to shipowners carrying clean products stipulating that charterers will have to nominate alternative safe discharge ports and pay more for further travel should there be any risk of their vessel being quarantined or detained.

A further clause in a charter party stated that the master of the vessel would not be required to discharge or load into any port where the cargo or crew would be exposed to disease, according to documents seen by Platts.

“Some owners do not want to take the risk of going to West Africa because of the Ebola crisis, and that will tighten up tonnage. At this stage it is not affecting rates, but with less vessels around they could well rise soon,” said one broker.

Platts said that on Thursday rates on Medium Range clean tankers, basis 37,000 mt, going UKC-West Africa were assessed at Worldscale 110, adding that this rate could rise to around w115-120 soon if fears over the disease spread among shipowners.

Dry bulk brokers are also worried about Ebola.  According to sources cited by Platts, Supramax owners were no longer willing to take vessels to West Africa, and that vessels operating in the region could start to receive a premium if more owners pulled out.

“On the dirty side, shipping sources said there would be limited impact from the outbreak, particularly for the VLCCs. The VLCCs were said to be safe because they did not come into ports to load, instead doing so at offshore loading terminals,” Platts said.

A Chinese-flagged ship heading from Sierra Leone to Cape Verde was put in quarantine in Sao Vicente last week so as to make sure the crew hasn’t been infected by the fatal Ebola virus. The ship will remain 21 days in quarantine to avoid any possible risk.

As of this May an outbreak of Ebola has hit Sierra Leone, Guinea, Liberia, and Nigeria and is the largest outbreak of Ebola in history.

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Press Release, August 18, 2014