PetroChina and India Oil Corporation failed to secure very large crude carriers to lift Iraqi Basrah crude in late June, according to company and shipping sources. The inquiries followed an interim agreement between the United States and Iran to end their war and to reopen the Strait of Hormuz, a vital waterway for Middle East energy supplies. Another Chinese major, Sinochem, was reported to be seeking a tanker for the same period.

PetroChina sought a very large crude carrier to load at Iraq’s Basrah Oil terminal between June 25 and 30, and each very large crude carrier can carry two million (mn) barrels of oil. The company received at least six offers at worldscale points of 650 to 750, which represented freight rates nearly triple those charged before the United States and Israel launched the conflict in late February. Worldscale remains the standard industry measure for calculating tanker freight rates.

Company contacts indicated that tankers were available but that freight was prohibitively expensive and that there was no guarantee of a safe exit from the strait. A shipping source said securing supplies from the Gulf would likely remain complicated despite the peace accord and that fixing a vessel would be difficult given the levels of the rates. The source added that both charterer and owner would probably need to agree specialised contract clauses to cover transit of the strait.

Sinochem sought a very large crude carrier to load oil in the Gulf between June 20 and 30 for delivery to Asia, but it was not immediately clear whether the company would succeed in finding a vessel. Indian Oil Corporation received no offers in a recent tender for a ship to lift Iraqi crude on June 22 and 23 for delivery to Paradip port on India’s east coast and subsequently declared force majeure on the cargo. Neither PetroChina nor Sinochem nor Indian Oil responded immediately to requests for comment from the news agency.