<article><p class="lead">Traders are idling three US crude-laden very large crude carriers (VLCCs) under storage charters near Singapore and China and are directing three more VLCCs, also with storage options, to head that direction with US crude cargoes. </p><p>The <i>Maran Cygnus</i> has been storing US crude near Malaysia since 24 June and the Hess-chartered <i>Desimi</i> has been doing the same near trading hub Singapore since 3 July, according to vessel tracking data from Vortexa. The Freepoint-chartered <i>Delta Glory</i> has been waiting with US crude since 2 July outside the Chinese port of Qingdao, which is experiencing lengthy <a href="https://direct.argusmedia.com/newsandanalysis/article/2124411">delays</a> due to clogged pipeline and storage capacity. All three VLCCs were chartered since March with floating storage options, according to the <i>Argus</i> floating storage bookings database. </p><p>Three additional VLCCs booked with storage options are en route to Asia with US crude. These include the Hess-chartered <i>Blue Nova</i>, the Vitol-chartered <i>Neptun</i>, and the <i>DHT Edelweiss</i>. </p><p>Despite a drop in freight costs because of subdued crude export demand, the cost of storing crude on these tankers is still elevated because many of them were chartered during the peak freight rates in March and April. For example, the <i>Eliza</i> VLCC, which Shell chartered in April for $120,000/d, has been storing Mars crude since 7 April. The ongoing storage duration of 107 days for the <i>Eliza</i>, which has shifted from floating storage in the US Gulf coast to east coast Canada, yields a storage cost of $12.8mn — more than double the freight cost of a US Gulf coast-China VLCC shipment today. </p><p>Some traders are opting to keep their US crude-laden VLCCs they booked with storage options in the US Gulf coast. The <i>Front Endurance</i> VLCC, which Trafigura chartered for $100,000/d according to the <i>Argus</i> database, finished loading its US crude cargo on 1 June and has remained in the region, according to Vortexa. A second VLCC, the Shell-booked <i>Maran Corona</i>, remains in storage in the US Gulf coast after loading at the Louisiana Offshore Oil Port on 23 April. </p><p class="bylines"><i>By Nicholas Watt</i></p></article>
