Demand Rising for Oil Tankers (FRO, NAT, TK)

Saying that Frontline is “seeing an incredible amount” of contracts from the Persian Gulf, day rates have risen to $25,000-$30,000. That’s better than a doubling in just over a week.

The sudden jump in cargoes could be due to escalating tensions between Europe and Iran, with China taking Iranian crude at a lower price and adding to its inventories before the full effect of the sanctions hits Iran later this year.

Frontline’s shares are up nearly 7.5% at $5.90 in a 52-week range of $2.52-$25.09. Nordic American shares have jumped more than 5% to $14.41 in a 52-week range of $11.58-$25.89, and Teekay shares are up just over 1% at $30.62 in a 52-week range of $20.67-$37.93.

Paul Ausick