Ea Gibsons News

Tanker markets cooled as Asian holidays took the steam out of recent strength, but some brokers saw it starting to simmer again last week. Holidays in Japan and Korea this week coincided with the end of most charterers' May programs, brokers said May 5. Approximately 18 VLCC fixtures of five million tons were reported in the Middle East Gulf, down from 22 of six million tons the week before, according to broker E.A. Gibsons. "However, there was sufficient momentum in the market to maintain rates at their previous levels," Gibsons said. With modern tonnage remaining in tight supply it was reasonable to expect rates to stay at current levels or even improve over the next few weeks, it added.

Charter rates for product tankers continued to be depressed as surplus tonnage kept a lid on rises last week despite an increase in business in several loading areas. The Middle East saw levels fall. Tankers carrying 25,000 tons into India were seen taking W165, the same for 30,000 tons to Japan. Larger ships carrying 75,000 tons to Japan were attracting around W120. Shipping brokerage E.A. Gibsons said there was sufficient prompt tonnage of LR 2s to indicate that rate may decline further. Increased chartering in the Mediterranean did not propel rates higher. Shippers said it was an all-too familiar problem of too many ships chasing too few cargoes. Rates for 30,000 tons of gas oil hovered around W110-120 with naphtha cargoes of 27,500 were able to secure carriage around W150.

Caribbean business proved the high spot in a quiet but slightly improved clean tanker market, brokers said on Friday, September 17. Renewed activity in the Caribbean markets pushed 30,000 ton cargo rates to the U.S. Atlantic Coast up by around 10 points to W185-190 by the end of the week, brokers said. One U.S. broker pointed to rates pushing over W200 early next week. The two hurricanes hitting the U.S. East coast were partially responsible for the rise, brokers said. Transatlantic rates also moved up to W165-170 for 33,000 tons, E.A. Gibsons said in its weekly report. They had risen from about W160. Long range 75,000 ton Middle East to Japan rates also inched ahead as predicted on thinner availability of tonnage. Rates rose to W125 from W120.

Large tanker rates slid back slightly off recent highs this week as Middle East September stems drifted to their conclusion, brokers said. VLCC rates for Japan, which peaked at W52.5 at the end of last week, slid back to around W50 while western rates fell back to about W47.5 from a peak of W50. Late week VLCC fixtures included two Bayoil charters for Bergesen vessels to the U.S. Gulf from Al Bakr at a soft W47-47.5 for well ahead October 10 and 20 sailings. Some brokers said expected October stems next week would mean a busier time with rates picking up, but Galbraiths noted that the Bayoil and two Chevron October charters at the same rates and similar October dates showed market weakness.