Credit: This tanker is painted red, but Nordic Oil Tankers stock is shining green today. Image source: Getty Images.What happened
Shares of sometimes topsy , sometimes turvy oil shipper Nordic American Tankers Limited (NYSE: NAT) are on the upswing again today, rising 9% as of 2:20 p.m. EST -- and yet there seems to be no Nordic American Tankers-specific news to explain what is up, or why Nordic American is up.
This tanker is painted red, but Nordic Oil Tankers stock is shining green today. Image source: Getty Images.
So what
So what could explain the sudden popularity of Nordic American Tankers stock? I have three theories -- none necessarily conflicting with the others.
The first comes from Nordic American's recent earnings report, in which management cited a recent spike in suezmax charter rates to as high as $50,000 a day. With pricing so strong, Nordic American said it will soon be earning "much higher rates" on its ships -- certainly good news for the stock.
Of course, that's also old news, as earnings came out two weeks ago. More recently, we see that crude oil tanker rates have been holding up nicely on the Baltic Dirty Tanker Index, and rose another 4 points to 1,131 this morning .
Finally, the U.S. Energy Information Administration announced today that U.S. crude stockpiles rose for a 10th straight day. "Production is hitting new highs," reports OilPrice.com , and the more oil producers pump, the more demand there is for tankers to ship it.
Now what
And of course, as we all learned in Econ 101, the more demand there is for a service like oil transport, the higher the price a service provider like Nordic American Tankers will be able to charge. That's good news for the company's stock -- and for Nordic American Tankers investors.
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