Tanker stocks

Last quarter, tankers stocks such as Frontline (FRO) suffered from below average rates. This quarter looks weak so far as well. Why so weak when the fourth quarter is traditionally the year's strongest? Falling oil prices? I don't think so. I think this has more to do with oil stockpiles than oil prices. Lets look at this chart from the Energy Department. During the third quarter, stockpiles grew greater and greater than the five year average. When oil prices started dropping, there was no incentive to stockpile oil. Instead of importing oil, the stockpiles were opened. I believe that tanker rates will rebound when oil stockpiles return to five-year average levels. If they don't I'll have to look for another hypothesis to explain and predict rates.