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As Wimbledon reaches its climax, the VLCC market is in the Owners court. July 4

By • Jul 4th, 2013 • Category: Tankers

The Coracle tanker market podcast for July 4, 2013 in association with Braemar-Seascope

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Thanks for downloading the VLCC Tanker Market report podcast from Coracle and Braemar Seascope for July 4th 2013.

The VLCC market in the AG has moved back into the owners’ favour as a bit of cargo congestion caused by a greater than average second decade of fixing from the area handed the initiative back to shipowners. The problem for charterers started
last Friday, when owners asked for a few points above last done for AG/East, and when charterers wouldn’t pay it, the cargoes were rolled into the next week. Charterers were not to know that there was still a reasonable amount of cargo to
come for the 15-20 window, and suddenly on Monday more and more cargoes started to enter the market. Rather than paying only a point or two’s premium, rates for AG/East accelerated to 270 at 46 and more. At the same time, this increased volume started to clear out the tonnage list and meant that the friendlier owners were fixed, leaving a couple of cargoes in a more pressurised situation and owners pushing for significantly above last done. At the same time, charterers for AG/West spotted the excitement for the previous decade and tried to take a couple of ships off the market for the second half of the last decade. Although the list is more plentiful on these dates, there is still upward pressure and 280 at 24 has been done for AG/US Gulf via the Cape.

It was a similar story in West Africa, where charterers seemed quicker to react to the situation in the AG and managed to get ships on subs at rates of 260 at 40, rather than getting trapped into a corner and being restricted to Atlantic only vessels which would have forced them into accepting more. The Indian charterers completed their West African programme for the month of July last week. BPCL came into the market this week to start with their August programme out of the region. For 5-10 August dates charterers invited offers basis a minimum laden speed of 16 knots. Unsurprisingly, they received no offers basis their laden speed requirement and the enquiry was withdrawn. We expect other Indian charterers to get busier next week with their first decade August stems.

The 30 day availability index shows 42 VLCCs arriving at Fujairah, of which 3 are over 15 years old, compared to 54 last week. We have slowly reached a total of 105 VLCC fixtures reported for the month of July thus far, of which 55 were in the second decade and only 9 fixtures done to date for the last decade, which is the reason for the increase in rates recently. We are expecting a greater than average count this month.

The bunker price is US$591 per tonne, down $1 from last week.

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