Worldscale rates for chartering a very large crude carrier (VLCC) to transport two million barrels of crude oil from the Middle East to the US Gulf now stand at W82.5-W85, compared with W42.5 at the beginning of January.

To Japan rates have risen to W95-W100 from about W52.5. That means the cost of shipping oil to the US has almost doubled to $2 a barrel and surged to $1.50 barrel for crude going to Asia from the Middle East - rates at their highest in two years. Tanker brokers now expect rates to plateau out a little below current levels over the summer until increased oil production coincides with winter restocking in the autumn.

"I don't see any fundamental reasons for rates going much higher now," said one broker's tanker analyst. "There might be a little more upside to the US Gulf," said another, "but at W85/100 you shouldn't expect too much."Increases of 40 worldscale points over the first four months were unthinkable at the end of last year. Most shipping analysts did not expect a recovery until later this year. But that was before the impact of a small 25-year-old tanker sinking off France took its toll and Opec moved to relax oil production restraints.

-- (Reuters)