Rates for the largest oil tankers will rally as Persian Gulf exports rebound during the next several months, driven by increased demand from U.S. refineries, according to Morgan Stanley.

As much as 500,000 barrels a day of additional crude will be shipped from the Middle East through the northern hemisphere summer, requiring about 20 very large crude carriers, Fotis Giannakoulis, a New York-based analyst at the investment bank, said in an e-mailed report today. Day rates for the vessels, which averaged $7,000 this year, will rise to $30,000, a level last seen in November, he said.

Bookings for spot cargoes from the region averaged 60 million barrels a week during the past three weeks, 30 percent higher than in the preceding six, according to the report. Volumes scheduled for the U.S. surged to 19 million barrels a week on average in the past four weeks from 10 million in early January, Morgan Stanley’s figures show.

“As U.S. Gulf refineries return from maintenance, long- haul westbound barrels from the Arabian Gulf are expected to follow as Middle East becomes the marginal supplier,” Giannakoulis said in the report. “As Saudi production increases, we could see the balance returning to more reasonable levels, helping rates to restore part of the recent losses.”

Longer term, rates will remain curbed by weakening demand in the U.S. and Europe, increased North American production and a glut of vessels, Giannakoulis said.

Source: Bloomberg