Shipping's most volatile market, the Caribbean upcoast trade, has plummeted in the last few days to levels not seen since last November and
freight costs are now less than half of what they were just two weeks ago, brokers said on Tuesday.
But they were also quick to point out that this was merely a normal part of the yearly cycle as refinery turnarounds start to bite into the supply-demand balance.
"Every April for the last three years the Aframax (70,000 ton) market has dumped 40-50 points," said one U.S. broker. "A lot of crackers are down. Hess has had one in St. Croix down since mid-January."
Freight graphs from London shipbroker SSY confirm the observation. The decline ends a bull-run that started in mid-February when fog delayed lightering and loading schedules in the U.S. Gulf, forcing up rates.
Oslo brokers reported on Tuesday that Equiva had fixed a modern tanker, the Guardian, for a 70,000 ton cargo from Mexico at W159 ($1.2 per barrel), while in mid-March it was forced to pay about 84 percent more ($2.2 per barrel) for a similar fixture.