Markets - A softer tone all round

Feb 15 2019

Rates kept moving south in the crude carriers market last week, as Chinese holidays impacting demand in the Middle East, brokers reported.

The first discounts were also evident in the period market, where until recently, rates had resisted the downward pressure from spot earnings, while the 2019 slowdown seems to be enticing charterers, who are still after longer terms contracts across most size ranges.

At the same time, oil prices remained on an upward path, with the main support still coming from US sanctions against Iran and Venezuela, as well as OPEC cuts.

With demand in the Middle East market showing little strength, VLCC rates saw further discounts throughout last week, while the West Africa market followed suit, with the voyage to China moving to mid-WS40, marking a new year low.

West Africa Suezmaxes also ended the week softer, with enquiry in the region still outweighed by tonnage supply. As delays in the Straits further diminished, rates in the Black Sea saw pressure increasing.

Aframax rates were also down, with dropping demand in both the North Sea and Med softening owners’ resistance, while the Caribs market declined for a second week in a row.

Brokers also reported that ExxonMobil had fixed the 2019-built VLCC ‘Universal Leader’ for seven years at $31,000 per day.

Petro Diamond was said to have taken the 2004-built ‘Van Phong 1’ for 12 months at $16,500 per day, while BPC reportedly took the 2000-built MR ‘Seagull’ for 10 months, plus two optional six month periods, for $12,500 per day.

In the newbuilding sector, NACKS was said to have won orders for two VLCCs from Iino and another VLCC from MOL, while Hyundai Mipo was rumoured to won a series of MRs from Sinokor.

Turning to the S&P market, Middle East interests were said to have picked up the 1999-built Suezmax ‘Eurohope’ for $12.8 mill, while Nordic Hamburg was believed to have purchased the 2008-built Handysize ‘Conti Humboldt’ for $11.4 mill.

Nathalin was thought to have agreed on subjects to purchase the 2001-built VLCC ‘V Sakura’ for $21.4 mill, while also believed on subjects were the 2007-built Handysize ‘Krisjanis Valdemars’ and ‘Kandova’ for $24 mill en bloc.

Finally, Indonesian interests were believed to have purchased the 2004-built Handysize ‘Axelotl’ for a price said to be in the low to mid $7 mills.


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