Now the biggest US fleet lays up third of product carriers

SOME 30% of the US Jones Act product carrier fleet is laid up amid a deteriorating market, OSG America revealed last week.
However, this could have the benefit of eliminating single-hull tonnage, the company said.
Overseas Shipholding Group’s US-flag spin-off has placed three of its own ships in lay-up, a situation it said would continue for about another six months. OSG 214, a 1975-built barge, was laid up last month “because of deteriorating Jones Act market conditions, principally weaker demand levels, and lower refining margins”, the company said.
New York-listed OSG America, which lays claim to being the largest operator of US-flagged product carriers and oceangoing barges transporting refined petroleum products, said in its annual report last month that OSG 214, in tandem with the tug OSG Honour, was on a Marathon time charter through to November.
The other two laid-up ships, the 1983- built single-hulled product carriers Overseas Puget Sound and Overseas New Orleans, have been chartered out to OSG through to the end of this year.
OSG America admitted that the charterer would continue to pay charter hire, “but at reduced rates to reflect a lower level of vessel expenses during the lay-up period”.
These three units are among the 19 industry-wide that OSG America has identified as laid up or waiting for cargoes, a number not seen since the mid-1990s.