Great Britain’s Coastline Filled with Idle Tankers

Three tankers carrying North Sea Forties crude have been drifting off the European coast for over two weeks without being unloaded, indicating a slowdown in demand from refineries in Europe and Asia. This is the first time in over two years that this benchmark oil from the North Sea has been floating at sea, a rare occurrence attributed to oversupply in the European market and weak demand from refineries. Strong oil supplies from the Gulf of Mexico and competitive grades like Murban oil from Abu Dhabi and WTI Midland from the US have also impacted the lack of interest in the Forties grade.

The two ships, the Annual and the Jatuli, are anchored off Hound Point in the UK, while the Thornbury has been off Rotterdam since May 18. Forties sold at about $1.15 a barrel below the price of North Sea benchmark Dated Brent on May 21, the lowest price in over four years. The amount of crude in floating storage is expected to increase next month as some Forties cargoes scheduled for June have not yet found buyers, with most Asian refiners already securing enough barrels for August delivery.

The current situation with the Forties grade highlights the impact of oversupply and weak demand on oil prices and shipping. With the lack of interest from European and Asian refineries, the tankers have remained at sea for an extended period, signaling a challenging market environment for producers. The drop in Forties prices to a four-year low reflects the ongoing struggles in the oil market and the difficulties faced by traders in finding buyers for upcoming cargoes.

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