Markets - No change this week

Feb 23 2018

A quiet week was seen in the VLCC market.

With most of the Far Eastern charterers on holiday, celebrating the Lunar New Year, along with IP week in London, fresh enquiries were hard to come by, Fearnleys said. 


The few vessels that were fixed did not make any noteworthy impact on the current market, as the TCE earnings continued to be below opex levels. The tonnage list remained ample in all loading areas.


For the 1st decade of March, Suezmaxes saw significant improvement in cargo volumes working in West Africa, which contributed to a more steady market as a level of fluidity returned.


Furthermore, VLCC fixing in West Africa for the 2nd decade was light, therefore allowing further Suezmax cargo potential in the week ahead.


The Black Sea ticked over with TD6 currently around the WS67.5 mark and earnings hovering just around positive territory.


Forward TD20 paper contracts were still trading slightly up on current rates but tonnage oversupply was cancelling out any potential for a major market upswing, meaning more of the same for the foreseeable future, unfortunately, Fearnleys said.


Rates remained unchanged for North Sea and Baltic Aframaxes, despite ice developing rapidly in the Gulf of Finland. This was caused by the Polar vortex that has split in two, which tends to be associated with some of the coldest air during the winter season.


This should not have any impact on rates for the time being but could lead to delays going forward.


In the Med and Black Sea, the only difference is that we have moved from Libya end month cargoes to early decades Black Sea lifting and rates were much the same as last week.


Owners were trying to negotiate another couple of points each time a replacement charter was quoted, but unfortunately it usually didn’t amount to more than giving one lucky owner a WS2.5 - WS5 point increase on one fixture.


We believe the rest of this week will remain much the same, Fearnleys concluded.


Brokers recently reported that the 2018-built Suezmax ‘RS Aurora’ had been fixed to Navig8 for 12 months, plus a 12-month option, at $16,000 per day, plus profit sharing.


The same charterer was said to have taken a Daehan newbuilding Aframax for 12 months, plus a 12 month option period, for $16,750 per day. Trafigura was believed to have fixed the 2018-built LR1 ‘Cielo Di Rotterdam’ for six months for $13,750 per day.


NORDEN was thought to have fixed three MRs for 12 months at $13,800 per day, while Cargill was said to have fixed two Navios MRs for 12 months at $14,000 per day each. 


A couple of US MSC fixtures were reported. These concerned the 2009-built MR ‘SLNC Goodwill’ said to be fixed for 60 days at lumpsum $3.14 mill and the 2009-built MR ‘Maersk Michigan’ said to be taken for 90 days for lumpsum $4.23 mill.


In the S&P segment, Eurotankers was said to be the purchaser of the 2003-built Aframax ‘HS Carmen’ for $11.3 mill, while Chinese interests were believed to be behind the purchase of the 2000-built Panamax ‘Speed Pioneer’, while undisclosed interests were said to be involved in the purchase of the 2003-built Handysize ‘Rosa Tomasos’ for $8.5 mill.


Newbuildings were also reported with Sinokor ordering two VLCCs at Hyundai Samho for $83.5 mill each and H-Line contracting two VLCCs at HHI on the back of long term charters to GS Caltex for $85 mill each.


Oceangold was believed to have firmed options for another two MRs at STX for $32.5 mill each.


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