US to charge China-owned supertankers $5.2 million per port call

Made-in-China oil supertankers are set to be slapped with more hefty charges under America’s latest proposal to penalize ships manufactured in the Asian nation as the trade war between Washington and Beijing rages on.

China-made supertankers sailing under non-Chinese owners or operators can expect to be hit with a surcharge of nearly $1.9 million upon calling at a US port under the new rules, according to estimates by the research arm of Arrow Shipbroking Group. The sum balloons to $5.2 million for any China-owned or -operated ships, the firm said in an April 18 note.

Under Washington’s previous proposal, market observers had estimated charges of up to $3.5 million per US port call.

The drastic spike in fees under the latest proposal by the United States Trade Representative stems from a new method of calculating levies based on the vessel’s cargo capacity, or net registered tonnage. From mid-October, the cost for any China-made vessel operated by a non-Chinese entity stands at $18 per nrt, with rates rising to $50 should the tanker be owned or operated by a Chinese company. That’s in contrast with the previous proposal that levied charges on a per-visit basis.

As a result, supertankers such as VLCCs face much costlier fees with this methodology, as compared with smaller ships such as aframaxes. Under the new rules, product tanker of different sizes stand to pay between $575,000 to $1.2 million per US visit for ships that are owned or operated by China.

All in all, the new levies are seen as less severe than before, after taking into account carve-outs and exemptions, said Arrow. However, it “still has the potential to impose heavy tolls on shippers, and Chinese owners in particular,” the company said.

Most of the tankers currently trading on water are South Korean-built, however, with the Chinese fleet half their size, Clarksons Research data shows.