How Are Rates Calculated?


The amount you pay for your charter can be calculated using internationally recognized freight scales as well as a number of variables including:

• worldwide demand for tankers
• availability of a particular type of vessel in your market
• the type of charter (voyage/time/contract of afreightment/etc.)
• prevailing worldwide energy prices and political conditions

The rate of each fixture is calculated on a case by case. Ultimately, a good quality broker will have the negotiating skills to get you the best possible price on the best possible vessel. Soundtanker has the experience and network contacts you need.

Rate Scale
One example of a standardized rate calculation schedule is the Worldscale Tanker Nominal Freight Scale, published by a shipping industry group. This involves a lengthy schedule of rates for popular tanker voyages. Worldscale offers rates for as many as 300,000 voyages, allowing for the many combinations of load and discharge ports. These “flat rate” declarations reflect many things, such as tanker operating costs and distance/steaming time on route. However, they are often just the beginning. Potential charterers and shipowners – usually through a broker – will negotiate the actual price to hire the tanker. Because freight rates are set in highly competitive and often volatile markets, the daily balance of supply for particular vessel types is the primary driver. In addition, the highly cyclical nature of the oil tanker industry creates volatility in spot market, time charter rates and vessel values. Balancing your charter requirements and anticipating the differentials between time and spot markets is a good way to take advantage of the market. Get the leverage to get the best possible rate. Get a Soundtanker broker.