Tanker market news for VLCCBy james tweed • Jul 29th, 2013 • Category: Tankers
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Last week, charterers abstained from entering the market with any great gusto, choosing instead to drip feed cargoes and try to erode owners’ confidence. With less than ten cargoes covered for the first decade, owners were still hopeful that charterers would have to enter the market with increased volume in order to cover the fixtures before the laycans become an issue. This week, charterers have entered the market, as expected, in much greater volume, with some 40 cargoes now covered up to and including the 10th August. The Chinese COAs certainly added to the tally of fixtures, but owners found it difficult to capitalise on the increase due to a large percentage of these cargoes being covered off market. With the cargo count becoming much more manageable from the charterers’ perspective and the availability of ships ever increasing at the Fujairah Anchorage, owners’ confidence began to diminish as charterers set about dropping rates. The available cargoes soon became a high commodity and offers followed in great numbers. Rates dropped to a low of 34.5 for a trip down to South Africa but levels of around 37 seem to be sustainable at present for trips to the East. Western rates reflected soft sentiment and fell down to 22.5 via the Cape for a US Gulf discharge.
It has been a quiet week in West Africa, reflecting low volume for the month of August from the region. The second and third decades of August have been well short on cargoes when compared to the numbers from July. We will shortly be entering the window where charterers begin waiting for their stem nominations for September dates. Rates for W Africa/China are now being assessed at 37.5 by charterers, due to an ever expanding tonnage list. Minimal activity on the Continent due to the arbitrage being closed is now forcing tonnage opening in Rotterdam to focus on West Africa for any realistic employment opportunities, putting further pressure on rates. The Caribbean has been steady and busy this week. The rate for Caribs/Singapore has been repeated multiple times at $3.6m for Petrochina second decade stems and $3.2m for WC India discharge on account of the Indian charterers. The rates have remained steady from the Caribs, however, with the downward trend now prevalent on a more general basis in the VLCC sector we could see rates out of the Caribs dip slightly in the coming week.
The 30 day availability index shows 65 VLCCs arriving at Fujairah, of which six are over 15 years old, compared to 41 last week. July produced a total of 131 reported fixtures. The total number of fixtures reported from the AG for the month of August is 47.
The bunker price is $590/tonne, down $9/tonne from last week.
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