After a light November programme, December has been very active with over 50 fixtures already concluded. This surge of activity has translated into significantly firming rates in the Middle East Gulf as tonnage lists thin. After starting the week in the low/mid WS 50s for 270,000 tonnes from Middle East Gulf to the East, rates have jumped up, with WS 65 agreed for Thailand discharge and WS 62 for South Korea, before a further hike to WS 67.5 which is reported to have been paid by Petronas for Malacca discharge: these rates are giving owners a time charter return of around $55/56,000 per day. Earlier in the week a rate of WS 36 Cape/Cape was agreed for a cargo of 280,000 tonnes to US Gulf, although this was for a voyage with both east and west options so a premium for options would have been achieved. Today we understand for a straight voyage to the US Gulf, that Bahri is working tonnage with owners presently at WS 35 and charterers at WS 32 basis Cape/Cape routing.
In West Africa, rates have also firmed in line with the Middle East Gulf and after WS 57.5 was initially paid for a trip to China, we saw both WS 59.5 and WS 60 paid by Unipec. VLCC activity for shorter trips to Europe saw a further thinning of the tonnage list with rates here agreed between WS 75-80.
Off the Continent, Petroineos was reported to have paid $5.5 million for a fuel oil cargo from Rotterdam to Singapore. The Caribbean market has yet again provided the high point for owners as charterers continue to have to look a month ahead for tonnage. Rates here have continued to firm with $7.2 million paid for Singapore and between $8.05 and $8.5 million being paid for China discharge.
In West Africa, rates for 130,000 tonne cargoes have been falling sharply all week as charterers used VLCCs to co-load to counter the initial steep rise in the suezmax market. Whereas a week ago we saw levels of WS 152.5 being paid, Petrobras was able to cover a run to Brazil at WS 130 and Eni then paid WS 117.5. The last done now is Repsol paying WS 90 for a trip to Spain, with the owners confirming the first counter. The drop in rates was expected as VLCCs became a far more attractive and economical proposition.
Delays in the Turkish Straits have reduced, and as in West Africa, the Black Sea has similarly come under pressure. After WS 135/140 was agreed mid-week, a lack of enquiry is having a negative effect with charterers now looking for tonnage from 22 December onwards. The healthy rates now already seem like a distant memory as Agelef tonnage has now gone to Chevron at WS 100.
In the Mediterranean and Black Sea, it has been a repeat of the suezmax market and rates have quickly dropped from WS 230/240 to barely WS 150. Petrogal covered a short Algeria/Portugal run on a Vitol re-let at WS 170 and there are now reports of a Ceyhan cargo being fixed at WS 150 level. A lack of suezmax enquiry earlier in the week also lead to a number of suezmaxes taking 80,000 tonne part cargoes further dampening sentiment here.
In the Baltic, rates for 100,000 tonne cargoes have dropped significantly and after a modest reduction at the start of the week to WS 107.5, levels have plummeted to WS 90/92.5 and unsurprisingly this negative outcome has impacted the 80,000 tonne cross North Sea market where WS 110 would appear to be the new level.
The Caribbean/up-coast market for 70,000 tonne cargoes has fallen further this week and with a short week because of the Thanksgiving holidays in America, levels have slumped to WS 122.5 as tonnage has continued to build up.
It has been largely uneventful with rates here holding at around WS 130 for 55,000 tonnes to the US Gulf.
MRs on the Continent going transatlantic for 37000 tons have skyrocketed this week having jumped from WS 170 to a high of WS 227.5 as the tonnage list continues to tighten.
In the US Gulf, the market has largely held steady at WS 130 level as the firm Continent/transatlantic market helps maintain current rates.