Marine Link
Wednesday, November 29, 2023

Asia Tanker, VLCC Rates Could Climb

Maritime Activity Reports, Inc.

November 21, 2014

Charterers to release 30 Middle East VLCC cargoes next week. VLCC market buoyed by upbeat Suezmax, Aframax sectors.

Rates for very large crude carriers (VLCCs) on key Asian routes are set to continue the rebound that started on Wednesday with a raft of new cargo requirements and upbeat sentiment, brokers said.

Brokers anticipated charterers would ramp up the number of VLCC cargoes from the Middle East to be loaded in the first 10 days of December.

"There will be the best part of 30 cargoes to fix next week which is going to change everything," said a Singapore-based VLCC broker on Friday.

"The market will certainly be firm if it doesn't run away with itself," the broker said.

Charterers have drip-fed cargoes over the last three weeks, pushing rates lower.

But the smaller Suezmax and Aframax tanker sectors had become busier this week, with Suezmax rates from West Africa rising to their highest level since January, Norwegian broker Fearnley said in a note on Wednesday.

This had buoyed sentiment among VLCC owners.

Singapore Petroleum Corp paid 51.50 on the Worldscale measure to fix the 301,045 dwt (deadweight tonne) Koho 1 for a voyage from the Middle East to Singapore, which was slightly above the market rate, according to Reuters chartering data.

"When the tanker markets are all aligned like that it's a strong story for owners," the broker said.

With the strength in the market he doubted rates would fall below W50 until at least after Christmas.

There are likely to be around 110-120 VLCC cargoes from the Middle East in December, brokers forecast.

VLCC rates for the benchmark route from the Middle East to Japan fell to just under W51 on Thursday, against W53 a week earlier.

Rates for West Africa to China were slightly above W54 on Thursday, against W55 last week.

In other trades, rates for 80,000-tonne Aframax tankers from Southeast Asia to East Coast Australia surged to W115.5 on Thursday, up from about W101 a week ago, on strong cargo demand and tight tonnage supply, an Aframax broker said on Friday.

Clean tanker rates from Singapore to Japan continued their steady gains that started on Oct. 24 after climbing to W121.75 on Thursday against W119.75 last week as an increase in cargo volumes created a vessel shortage, a clean tanker broker said.


By Keith Wallis

Subscribe for
Maritime Reporter E-News

Maritime Reporter E-News is the maritime industry's largest circulation and most authoritative ENews Service, delivered to your Email five times per week