Too many ships, including newbuildings, ex drydockings and older VLCCs, strongly affected the trend and rates sharply declined, Fearnleys said in the broker’s weekly report. Many ships taken on timecharter early last year at relatively low rates were also weighing heavily on the sentiment.
Volumes both in the MEG and in West Africa were far from sufficient and the situation is not likely to change much before the imbalance ships/cargoes becomes more in line.
MEG and West African inactivity has persuaded owners to start ballasting towards the Caribbean putting downward pressure on Caribbean/East rates.
The new year started with a lot of Suezmax activity with rates reaching the WS85 mark for W Afr-UK/Cont/Med voyages. With the January programme evidently finished for the month, owners are sitting patiently in anticipation of the February cargoes coming out, as activity was limited in the past week.
As a result, rates took a small downward correction and are now to find a new fixing level. The MEG saw quite some activity, but rates moved sideways, as the market was fairly balanced for the time being.
North Sea and Baltic markets also moved sideways, despite the fact that ice restrictions were implemented in most major Baltic ports. This market would have seen firmer rates were it not for a third week maintenance programme at Primorsk, which led to a short fall of about 10 cargoes.
The North Sea market was still looking pretty soft, due to very low activity. However, going forward into the February fixing window, the ice market is expected to strengthen.
In the Med/B Sea, we have seen rates coming off even further this week, Fearnleys said. Dates were fixed far forward, and when delays in Turkish Straits have been reduced, charterers have had more time in hand and been able to hold back their cargoes.
We also see more ships coming back into a fixing position, which will put even more downward pressure on an already soft market, the broker concluded.
Among the recent fixtures reported, was the 2003-built VLCC ‘Olympic Legend’ reportedly taken by Shell for three months at a very firm $70,000 per day. Shell was also thought behind the fixture of the 2001-built VLCC ‘BW Utah’ for 18 months at $44,500 per day.
Other VLCCs reported fixed included a newbuilding, which was said to have been taken by Tesoro for 12 months at $40,000 per day and the 1996-built Yangtze Star thought fixed to Vitol for 12 months at $39,000 per day.
A couple of Aframaxes were reported fixed for short period business of around three months. These were the 2004-built ‘Sparto’ taken by Glencore for $37,000 per day and her sister ‘Pantelis’ by Litasco for the same rate.
Trafigura was believed to have fixed the 2013-built sister MR2s ‘Hafnia Phoenix’ and ‘Hafnia Leo’ for 12 months at $18,850 apiece, while LG Chemicals was said to have taken the 2008-built MR2 ‘Oriental Gold’ for 12 months at $18,500, illustrating charterers’ belief that rates are going north.
Another Hafnia- controlled tanker, the 2004-built Handysize ‘Hafnia Robson’ was thought fixed to Trafigura for 12 months at $17,500, while Maersk was said to have taken the 2009-built Handysize ‘Atlantic Jupiter’ for three years at an undisclosed rate.
In the newbuilding sector, another four MRs were believed to have been ordered at Hyundai Mipo by Greek interest Central Mare, bringing the manager’s total orderbook to 12 MRs. These were said to be declared options.
Andriaki was also believed to have firmed up options for two LR1s at STX for $46 mill each on the back of period business with Ultramar, while Minerva was rumoured to have ordered a series of tankers, the details of which were not available at the time of writing.
Japanese chemical tanker operator Doun KK was said to have ordered two 38,500 dwt stainless steel chemical tankers at Kitanihon for $55 mill each.
In early January, Gener8 Maritime took delivery of two more VLCCs - ‘Gener8 Apollo’ and ‘Gener8 Supreme’ - from Daewoo and SWS, respectively.
They are the fourth and fifth in a series of 21 VLCC newbuildings and will enter Navig8’s VL8 pool.
Elsewhere, Navig8 Chemical Tankers has taken delivery of the 18th IMO II Interline coated 37,000 dwt chemical tanker ‘Navig8 Achroite’ from Hyundai Mipo. She will operate in the group’s Delta8 pool.
In the S&P market, Greek interests were said to be on subjects to buy the MRs ‘CPO Korea’ and ‘CPO Japan’.
They were built in 2009 and 2010 and were priced at $27.5 mill and $28.5 mill, respectively, according to brokers’ reports.