Aframax Rates Jump 40 Percent From Mexico To Venezuela

The cost of an Aframax tanker to carry crude from Mexico and Venezuela to the U.S. has surged by 40 percent in the last week as cargo owners scrabble over a fast-dwindling fleet, but in Europe trading is dull.

"You won't find a ship available now until August 12, so the ship owners are getting very bullish on rates," one U.S. broker said of the Caribbean market on Wednesday. He pegged the upcoast trade on Aframaxes (70,000 tonners) at W165.

But Thursday morning's fixture lists from Europe showed that Chevron had snapped up the Genmar Agamemnon for August 12 loading at the very firm rate of W175 ($1.29 per barrel), raising the possibility that charterers would have to wait even longer for available ships - representsing a rise of $0.41 per barrel in the course of a week.

"People are fixing further and further out, say two to three weeks, just to secure tonnage," said the U.S. broker.

He said charterers would always pay more to avoid the risk of being caught with a cargo but no ship to load it into.

The market has gained as much as 10 points a day since last Wednesday when it stood at W125 ($0.88 per barrel), brokers said.

Thursday fixture lists showed the first signs of a positive knock-on for Panamax ships (50,000 tonners).

Rates had labored around W130 since demand slackened off during the U.S. Independence day holidays, but Citgo paid W155 ($0.97 per barrel) for the Eleanora, loading at Bajo Grande Venezuela on August 12.

But while owners of Caribbean cargoes were scrambling after any tanker they could find, those with North Sea cargoes were able to take their pick and even force a discount.

"It's not looking too clever in the North Sea right now," a London broker said on Thursday. "Aframaxes were still getting W120 last week, but now they're down to about W105 ($0.56 per barrel)." This followed a sharp fall from W165 in mid-July.

He said the million-barrel ships were getting the "surprisingly firm" rate of W100 for North Sea cargoes heading into North Europe ($0.53 per barrel).

The Mediterranean trade has also traded down, with brokers pegging Aframaxes at W130 for older tonnage and W140 for the very best ships.