Weekly Tanker Summary
July 8, 2016
The following is an overview of tanker spot market activity for the week ending July 8, 2016
VLCC
Activity dipped in the AG as 30 ships were reported fixed or on subjects this past week. Rates for AG/East fell as low was WS 40 before moving slightly higher. An AG/USG voyage was concluded at just under WS 25 via the Suez Canal, while AG/West Coast India looked to pay in the low WS 60s.
Activity fell again in the Atlantic Basin as 13 vessels were reported fixed or on subjects, including six in West Africa, five in the Western Hemisphere and two in the UKC. In West Africa, rates for discharge in West Coast India paid around US $2.9 million, while to East Coast India a rate of US $3.25 million was paid. East Coast Mexico/Korea was reported done at US $4.65 million, while Brazil/China paid slightly above WS 50.
SUEZMAX
Activity has continued to climb in the West Africa region as 12 ships were fixed or put on subjects this past week. Voyages to UKC-Med traded in a narrow range – WS 67.5-70 – with the lower level dominating end-week fixtures.
Volume was weak in the Black Sea/Med as only about five vessels were reported fixed or on subjects. Rates ex-Black Sea initially held their ground – and then some- as WS 87.5 was achieved early in the week. A Ceyhan/UKC voyage paid a healthy rate of 135,000 x WS 77.5, but as the days progressed, rates started to retreat. Ultimately, two fixtures reflected the declining state of this market, as WS 72.5 and WS 67.5 Sidi Kerir/Spain were concluded.
AFRAMAX
There is no change to report in the Caribbean as rates remained steady at the WS 82.5 level. Lighterage in the US Gulf is about US $18,000/day and is seemingly the perfect way for owners to kill time in this depressed market with spot voyage returns hovering around US $7,000/day on a TCE basis. There has been more willingness from owners to fix to the East as well, with US Gulf/Singapore trading at approximately US $2 million basis no heat.
Med rates traded down from the high to low WS 90s where they remain heading into the weekend. It was reported that a deal has been struck between the rival NOCs in Libya that could lead to an uptick in oil production.
PANAMAX
It was another quiet week in the Caribbean with little reported activity. Caribs/Peru was reported at WS 85, a year-to-date low. Up-coast rates softened to the WS 90 levels and will likely remain weak in the near term. The UKC and Med markets saw some activity this past week. A vessel was put on subs for a Med/US Gulf voyage at WS 100, but is not indicative of the market. Rates are expected to hold at the WS 90 levels.
CLEAN
The UKC/USAC voyage opened soft at WS 105 before quickly losing 5 WS points on Monday. By midweek, the market bottomed at WS 90, but quickly made a recovery to WS 95. The front end of the tonnage list is tighter heading into the weekend, and with an uptick in US Gulf activity, we should see less ballast tonnage head to the UKC for third decade cargoes.
The US Gulf opened on a quiet note after the long holiday weekend in the States. Cargoes for the July 10-15 window seemed to be non-existent and rates had seemed poised to soften, until a rush of 10+ stems hit the market. Owners took advantage of the uptick in activity and pushed the market up 5 WS points to the WS 70 level.
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