However, much to owners’ frustration, charterers started drip-feeding 1st decade December stems into the market and rates corrected downwards. For example, last done on the MEG/Korea route was some WS5 points less than before, Fearnleys reported.
At the time of writing (Wednesday), the tonnage list looked ample up to the current fixing window and hence added further downward pressure on rates.
Suezmaxes were hampered by tonnage lists, which reflected the over supply of tonnage during the past week. Owner, disappointed by a slip in rates, dug their heels in and managed to claw back a few points but the fundamentals were against them.
Even taking an increased bullish stance, owners were only able to push TD20 to WS77.5 levels with TCE returns just below the $10,000 per day mark.
Black Sea delays were steadily mounting but even this had very limited impact and TD6 hovered around WS85.
The outlook is steady for the week ahead, as there are a number of West Africa stems unsold, which will hold cargo supply in check for the rest of 2nd decade December dates. It seems a lot of this oil being pushed into January, Fearnleys said.
As predicted, North Sea and Baltic rates moved up slightly, as the end/early dates came into play. A steady flow of cargoes are moving into December and present rates should be maintained for another week.
In the Med and Black Sea, rates were under constant pressure this week. As seen many times before this year, a relet took the market down. Most charterers are now asking for Canakkale cancelling about 10 days prior to the laycan, as the winter months arrive. Black Sea stems were being fixed as far forward as 11th December.
As a consequence, we have seen a gap of more than WS15 points for Black Sea fixtures, compared to cross Med charters, Fearnleys concluded.
As for the situation in Venezuela, Thomson Reuters Oil Research reported that exports plummeted during the last few weeks, as the country struggles to maintain uninterrupted operations in all sectors of its oil industry.
Exports averaged at 1.32 mill barrels per day in October, down from 1.66 mill barrels per day in September. The cumulative volume of crude oil that left the country stood at 40.8 mill barrels last month, almost 8 mill barrels below September levels, or the equivalent of four VLCC cargoes.
October was a slow month for the country’s crude exports, with only 17 mill barrels departed by 22nd November. With less than half of the volumes loaded to date, compared to October’s total, November is likely to see another drop in shipments.
It is worth noting that most other OPEC members have already exported 60-70% of the total volumes seen last month so far in November, Thomson Reuters said.
The decline in exports comes primarily on the back of lower US and Chinese liftings. The two countries trimmed volumes in October and continued to reduce intake this month.
The US, which imported more than 500,000 barrels per day in September, accounted for only 390,000 barrels per day in October and to date has only picked up 280,000 barrels per day of Venezuelan crude during November. Similarly, China trimmed its allocation from 350,000 in September, to 250,000 barrels per day in October, while November has only seen a single shipment of 1.7 mill barrels thus far.
In the charter market, brokers recently reported that Petrobras had fixed the 2017-built LR1 ‘Amazon Falcon’ for 12 months at $14,500 per day.
Shell was reported to have taken the LR2 ‘Lyric Camellia’ for three months at $15,500 per day, while US Military Sealift Command (MSC) was said to have fixed the MR ‘Maersk Michigan’ for 90 days at just over $4.9 mill lumpsum.
In the S&P sector, the Parakou-controlled 2006-built MR ‘Pretty Scene’ is to be auctioned on 5th December through South African Auction House, Clear Asset at Bowmans’ premises in Durban (correspondent attorneys) acting for Credit Agricole Asia Ship Finance.
She was arrested in June, 2016 in Durban, South Africa and is at the anchorage.
In other news, the 2017-built Suezmax sisters ‘Dong-A Spica’ and ‘Dong-A Capella’ have been sold for $47.5 mill each reportedly to TMS and New Shipping, respectively.
Another two sisters, the 2004-built Handysize ‘Edith Kirk’ and ‘Marie Kirk’, were said to have been sold to Monaco-based interests for $9.7 mill each.
Finally, the 2007-built MR ‘Fidias’ was thought sold to Pacific Carriers for $16.5 mill.
In the newbuilding sector, the Chinese have continued their ordering spree.
This time, China’s Cosco Shipping Energy Transportation (CSET) has contracted Dalian Shipbuilding to build four VLCCs and three Suezmaxes for just over $550 mill in total.
The new VLCCs are expected to be delivered in August, October, December, 2020 and March, 2021, respectively, while the Suezmaxes are set to join CSET in August and November, 2020 and January, 2021, respectively.
The company said that it proposed to issue non-public A shares to finance the tankers. If the sale of the shares does not proceed, the newbuildings are expected to be funded by the company’s internal resources or other means of financing, including bank borrowings.
Elsewhere, Philly Shipyard has announced the delivery of the Jones Act MR ‘American Pride’, the fourth and last in a series of 50,000 dwt product tankers ordered by American Petroleum Tankers (APT), a subsidiary of Kinder Morgan.
The vessel was delivered 10 days ahead of the contract delivery date.