Rates firmed still further climbing close to $100,000 per day, a level not seen for years, Fearnleys reported.
Continuous delays in Chinese ports combined with bad weather helped to make the open tonnage list both thin and uncertain and made charterers reach way ahead on dates both in the MEG and West Africa.
As a result, sentiment and general optimism among owners was boosted as tonnage looked thin in most VLCC loading areas. Rates are likely to remain firm and under upward pressure as winter approaches, the broker said.
As rates softened after the heavy spike last week, the Suezmax market again picked up. As expected, the third week ex West Africa was bigger than most had anticipated and along with a helping hand from other areas, the market saw a healthier increase, compared to the last jump in rates.
In addition, prompt vessels were fixed for later dates, giving a smaller overhang of vessels on the West Africa position list.
The current trend might continue on the back of the strong MEG market for both VLCCs and Suezmaxes.
Aframaxes in the North Sea and Baltic also experienced a healthy increase in rates last week. After a slow period, sentiment changed mainly on the back of a larger crude programme in Primorsk and Ust-Luga.
This pressure on rates also transferred to the North Sea even if activity in this area was less than seen in the Baltic. The Med and Black Sea players finally saw more cargo activity after facing suffering rates and tonnage build up for some time.
This week, we have seen Black Sea volumes starting to absorb plenty of tonnage, which made enough impact to get momentum moving, Fearnleys said.
At time of writing (Wednesday), the market remained busy and we expect this trend to continue when we move into end October/early November dates, the broker concluded.
In what could be a further boost to Suezmaxes, Russia is to begin loading 135,000 tonne ESPO blend crude oil cargoes at Kozmino next month.
Russia’s ESPO blend crude is a popular medium-sweet crude among North Asian refiners and is regularly shipped to refiners in Hawaii and the US west coast, but the majority is consumed by China, Japan and South Korea, according to a report by Platts.
The cargo is usually loaded in 100,000 tonne lots on Aframaxes. However, Kozmino’s November loading programme includes two cargoes of up to 135,000 tonnes, as well as 23 Aframax cargoes.
Kozmino has been dredged while some berths at Kozmino have a draft restriction of 15 m, which only allows Aframaxes and LR2 vessels to load cargoes.
According to Kozmino port data, Berth No. 1 can load Suezmaxes with a maximum draft of 17 m, Platts said.
Tsakos Energy Navigation (TEN) has announced the charter for an average of 36-months per vessel for three LR2s to a major European oil concern for crude trading operations.
The total gross revenues from these three fixtures are expected to be around $100 mill.
“The appetite of major oil companies to lock forward long-term is a positive testament to the prospects of the already strong tanker market. With $1.5 bill of total contracted revenues to date and a 15-vessel newbuilding programme, 12 of which are already on long-term contracts, TEN combines long-term stability and future growth prospects to our shareholders,” Nikolas Tsakos, TEN president and CEO commented. “TEN’s secured cash flow increases predictability and safeguards our net income and dividend payments going forward while our profit sharing and spot market exposure allows us to take advantage of strong rate spikes.
TradeWinds thought that the vessels concerned were the 2006-built ‘Proteas’,‘Promitheas’ and ‘Propontis’.
Other recent timecharter fixtures reported on brokers lists included the 2005-built VLCC ‘New Spirit’ fixed to CPC for three years at $39,000 per day - Chinese operator Unipec was one of the instigators of the recent VLCC spot market rise by taking a large number of vessels on charter.
Euronav reportedly fixed the Suezmax ‘Suez Hans’ for a very healthy $35,500 per day for 12 months work, while the 1995-built Suezmax ‘Front Glory’ was said to have been taken by Emerald Shipping for $28,000 per day and unknown charterers were believed to have fixed the 2010-built Aframax for three years at $25,500 per day.
In the MR segment, Petronas was said to have fixed the 2009-built ‘Zheng Chi’ for 12 months at $18,500 per day.