Ari Onassis was a business partner but above all a very good friend of mine for many years until his death in 1975. It was great to know him and fantastic to be involved in his odyssey and contributes to build his empire. There are so many things that are said about Ari and by creating this blog I want to reflect the reality about him to make sure his memory is not stained by gossiping people that don't know anything about him. You can also view my website:

Monday, October 17, 2005

Onassis hits the spot

In the spirit of founder Aristotle Onassis, Olympic is raking in the rewards of a savvy market strategy.

The Onassis group's recent chartering practice of placing most of its fleet of tankers on the spot market is paying off handsomely.

Ten of the 13 tankers managed by the Onassis group's Olympic Shipping and Management are currently working on the spot market and benefiting from the highest rates in years.
In the most recent spot fixture, the 309,000-dwt tanker Olympic Legend (built 2003) was reportedly fixed by Tupras a few weeks ago at World Scale (WS) 257.5, or around $175,000 per day, to transport crude oil from Iran to Egypt.

In the three months before this latest fixture the ship had average earnings of over $100,000 per day, according to sources close to the company.

The rates are especially lucrative when seen against the background of the company paying about $75m in 2001 for the ship in a resale deal with LMZ Transoil.

The Olympic Legend is one of two VLCCs bought from Transoil. Its sistership, the 309,000-dwt Olympic Liberty (built 2003), is one of the few vessels Onassis has on long-term time charter. It has been fixed to Exxon-Mobil for 10 years starting in February 2003 at just above $30,000 per day.

Olympic controls five VLCCs, only two of which are on long-term charter. The other VLCC not on the spot market is the 308,000-dwt Hawk (built 2000), which is also chartered to Exxon-Mobil at market rates. MarCare Shipping Co, a joint venture between Peter J Goulandris, Onassis interests and Exxon-Mobil, controls this tanker.

Even though the Olympic Liberty is not earning the astronomical sums it could have achieved on the spot market, it represents a timely investment. The two VLCCs plus two recently delivered suezmax newbuildings cost the operator about $250m-a bargain in today's climate.
The company's 302,000-dwt tanker Olympic Legacy (built 1996) is currently earning between $150,000 and $200,000 per day, nearly twice as much as it did in mid-July. CSSSA had fixed the tanker at WS 112, or around $70,000 per day from the Middle East Gulf to the UK continent at the time.

As with the VLCCs, Olympic has split two of its newest suezmax additions to its fleet between the two charter markets.

The 156,000-dwt Olympic Future (built 2004) has been working on the spot market since its delivery from Japan's Namura Shipbuilding in August. Sources say the tanker is currently on a fixture to Trafigura from the Middle East Gulf to China at WS 220, or around $60,000 per day.
The 155,000-dwt tanker Olympic Flag (built 2004), delivered soon after the Olympic Future from the same yard, has been fixed by Sun Oil for up to seven years at an undisclosed rate.
The company's other two suezmax tankers and four aframax tankers are working the spot market. One of the latest fixtures was for the 96,000-dwt tanker Olympic Serenity (built 1991), working Singapore to Italy at $37,000 per day.

Earlier, it was with Exxon-Mobil at WS 200 from the Red Sea to Singapore on a fixture that works out to be around the same daily rate.

Olympic also controls six bulkers, five of which are handysize Lakers on three-year long-term charters. The 64,000-dwt bulker Olympic Galaxy (built 1982) is employed in the spot market.

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