In the debt-heavy oil transportation industry, lower transportation rates can seriously jeopardize a company's solvency. We're now seeing rates at $21,000 per day for the average very large crude carrier (VLCC), compared to Suezmax shipping rates of more than $70,000 per day in 2010. The rates are down 5.5% so far this year compared to previous estimates and they look to still be turning lower in the near future. The firms in this industry will have to become a bit more creative with financing to remain going concerns.
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The article A Crude Reality: Oil Tankers Drowning in Debt originally appeared on Fool.com.
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