The current boom in the shipping industry is based on solid fundamentals. To be sure, shipping has been booming for quite some time.
From September 2002 till March 2003 period, when average tanker (crude, petroleum products) freight rates rose around 260 per cent to around $50,000 per day. But these firm rates could be attributed more to events rather than any sustained improvement in fundamentals.
First, there was the usual winter demand for crude from US, where oil inventories had touched new lows. Secondly, the Venezuelan oil strike led to countries beefing up oil inventories. This was especially important, coming on the back of the Iraq war, since it takes an average 40 days for transporting oil from Mid-east to the US.
The final thrust to freight rates was given by the sinking of the
