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Morgan Stanley to secure supertanker to store crude oil
Times of London ^ | 01/16/09 | Leo Lewis

Posted on 01/15/2009 9:40:19 PM PST by TigerLikesRooster

January 16, 2009

Morgan Stanley to secure supertanker to store crude oil

Leo Lewis, Asia Business Correspondent

Shipping brokers in Tokyo say that Morgan Stanley has joined a growing international scramble to secure an oil supertanker and use it to store millions of barrels of crude in what commodity dealers believe may be the “trade of the year”.

The rush to snap-up supertankers and profit from the huge “contango” spreads between the falling crude spot price and rising futures price comes amid dire warnings by analysts over the future of the wider shipping industry.

Massive overcapacity and slumping global trade are expected to trigger a second collapse in cargo rates, which already plunged nearly 94 per cent last year. Exports from China, Taiwan, Korea and Japan are falling fast and expected to drop further at a pace not seen since the early 1980s.

Sources throughout the Asian shipping sector say that despite a recent rally in container and dry bulk rates, 2009 could see dozens of firms going bust. A spokesman for Japan’s largest shipping line, Nippon Yusen, predicted prolonged difficulties for cargo rates as the global economy falters.

(Excerpt) Read more at business.timesonline.co.uk ...


TOPICS: Business/Economy; News/Current Events
KEYWORDS: cargorate; contango; crookswhowebailout; energy; morganstanley; oil
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1 posted on 01/15/2009 9:40:19 PM PST by TigerLikesRooster
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To: TigerLikesRooster; PAR35; bamahead; AndyJackson; Thane_Banquo; nicksaunt; MadLibDisease; ...

Ping!


2 posted on 01/15/2009 9:40:41 PM PST by TigerLikesRooster (kim jong-il, chia head, ppogri, In Grim Reaper we trust)
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To: TigerLikesRooster

I want the franchise for spraying liquid bedliner into the containers of the container ships. Maybe that’s the next place to store it, now that we’re not buying as many poisoned toys and one-use electric tools from China any more.


3 posted on 01/15/2009 9:44:34 PM PST by jiggyboy (Ten per cent of poll respondents are either lying or insane)
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To: TigerLikesRooster

they must think oil will go up significantly.


4 posted on 01/15/2009 9:49:44 PM PST by ken21 (people die and you never hear from them again.)
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To: ken21
Iran and Russia.
5 posted on 01/15/2009 9:50:52 PM PST by TigerLikesRooster (kim jong-il, chia head, ppogri, In Grim Reaper we trust)
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To: TigerLikesRooster

“Frontline, which owns the world’s largest fleet of supertankers, said yesterday that around 80 million barrels of crude are currently sitting in storage in the hulls of various ships around the world.”

That’s about a day’s worth of oil, correct?

Another cattle call for a bubble.


6 posted on 01/15/2009 9:52:17 PM PST by headstamp 2 (Been here before)
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To: jiggyboy
Or tons of unused melamine.
7 posted on 01/15/2009 9:52:20 PM PST by TigerLikesRooster (kim jong-il, chia head, ppogri, In Grim Reaper we trust)
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To: TigerLikesRooster

Just what we need. Morgan Stanley wants to do their part to drive up oil prices again. Didn’t they get some bailout money? We would have been better off, if they had just gone under.


8 posted on 01/15/2009 9:53:30 PM PST by 3niner
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To: TigerLikesRooster

This is going to end badly for those storing crude, imo.

Crude will continue falling and will be in the $25 range before too long. And then many of those holding these vast amounts of oil in storage will finally capitulate for some reason (margin calls on other investments, more deflationary data/demand destruction) and panic sell driving the price lower and lower.

$15/bbl crude by April or sooner.

Of course, the massive hyperinfation heading our way within a few years might make these gambits hugely successful long-term.


9 posted on 01/15/2009 9:56:42 PM PST by adm5 (YOU CANNOT FIX CAPITALISM WITH SOCIALISM! -Glenn Beck)
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To: TigerLikesRooster
between the falling crude spot price and rising futures price

As we saw last month, the price of oil drops abruptly when it nears the end of the trading month. The speculators keep betting that the price is going to turn around, but when it comes time to fish or cut bait, they have to bail on their contracts. Look for another spike when March becomes the front month on the futures trading, followed by a similar cycle.

10 posted on 01/15/2009 9:57:55 PM PST by PAR35
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To: TigerLikesRooster
Morgan Stanley still speculating.

There are supposed to be about a hunnert of these floating spot markets anchored or driving around in circles.

yitbos

11 posted on 01/15/2009 9:58:32 PM PST by bruinbirdman ("Those who control language control minds.")
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To: bruinbirdman

and they just came out with report saying oil was going to 25 a barrel! what a joke


12 posted on 01/15/2009 10:02:24 PM PST by remaxagnt (`)
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To: remaxagnt
Morgan Stanley

yitbos

13 posted on 01/15/2009 10:07:19 PM PST by bruinbirdman ("Those who control language control minds.")
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To: remaxagnt
6 month chart might give a better idea

MS

yitbos

14 posted on 01/15/2009 10:09:43 PM PST by bruinbirdman ("Those who control language control minds.")
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To: TigerLikesRooster
These... ummmm.... guys are taking physical possession of real assets? Instead of selling the contracts to pros that have a clue?

What could go wrong with that?

Do they have any idea what $2M worth of oil even looks like?

This is going to be funny, I don't care who you are.

/johnny

15 posted on 01/15/2009 10:13:54 PM PST by JRandomFreeper (God Bless us all, each, and every one.)
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To: 3niner

They want to own oil when it invariably goes up in price. There is nothing sinister about this, and assuming their predictions are correct it is good for the economy, since it smooths out the price by raising it slightly now and lowering it in the future when this supply is sold.


16 posted on 01/15/2009 10:14:03 PM PST by Arguendo
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To: JRandomFreeper

I have no idea how much it costs to store it for a year, but they could buy it today for $35/brl and buy futures guaranteeing they’ll get $50/brl for it in May (or $59/brl next January). Could be a good investment if there’s lots of unused tanker capacity that can be obtained cheaply at the moment.


17 posted on 01/15/2009 10:23:04 PM PST by Arguendo
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To: Arguendo
It used to be close to a dollar a barrel a month.

/johnny

18 posted on 01/15/2009 10:29:38 PM PST by JRandomFreeper (God Bless us all, each, and every one.)
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To: 3niner
Just what we need. Morgan Stanley wants to do their part to drive up oil prices again. Didn’t they get some bailout money? We would have been better off, if they had just gone under.

If they're using their own money, why complain? The only way they'll make money is if they sell the oil when prices are higher than when they bought. By doing so, they will have acted to reduce the gap between the high and low prices. That's a good thing.

If they end up buying high and selling low, they'll make the price gap worse than it would otherwise have been, but if they're using their own money to do that they'll lose more themselves than they'll cost everyone else.

Of course, if they figure out a way to leave the taxpayer on the hook when they buy high and sell low, then they'll nail everyone coming and going.

19 posted on 01/15/2009 11:10:14 PM PST by supercat (Barry Soetoro == Bravo Sierra)
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To: TigerLikesRooster

I can just imagine those little Wall St faggots astride their big bad super tanker toy


20 posted on 01/15/2009 11:16:38 PM PST by dennisw (On the thirty first floor a gold plated door won't keep out the Lord's burning rage ---FBB)
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