More to Come Down the Road

May 10, 2018

Tanker freight rates have experienced weakness this year as persistent over ordering in previous years come to fruition in the form of an unbalanced market.  The fundamental relationship between transport demand and vessel supply truly dictates the direction of the market as our remotely-sensed vessel position data points to declining vessel utilization.  Using an exponential regression, we calculate the R Squared of the combined VLCC and Suezmax utilization (independent variable) on the combined TCE earnings to be 0.81, a strong correlation statistic.  On an equal weighted average, we note TCEs declined about 70% in the first four months of ...