Okeanis Eco Tankers has fixed a scrubber-fitted spot VLCC at a time charter equivalent rate way above what is on offer to non-retrofitted sisterships.
The Oslo-listed Greek owner's 319,000-dwt Nissos Anafi (built 2020) will load Brazilian crude for a Chinese charterer in mid-February at an estimated TCE of $15,000 to $16,000 per day, according to Fearnley Securities.
Another source told TradeWinds that the voyage will earn in the mid-$17,000s per day, with ballast time optimised.
This is well above what non-scrubber tonnage can hope to achieve, with VLCCs averaging $6,600 per day on Friday last week, according to Clarksons Platou Securities — up 79% on the day but below operating expenses quoted at $8,000 per day.
Out of the red
Rates were cited at just $400 per day from the Middle East to South Korea, compared with -$800 per day.
The most modern scrubber-fitted units are limiting losses through the widening spread between compliant fuel and high-sulphur bunkers.
Fearnley sees the downside of the Okeanis deal as the tying up of the tanker for a 90-day round trip, potentially foregoing improved earnings down the line.
"Though the scope for increasing volumes near-term is unlikely in our view given further lockdowns globally and [the] Saudi's apparent stance on the oil market balance," the investment bank said.
The Nissos Anafi is on subjects until the evening of 26 January.
One industry player told TradeWinds that fixing a longer voyage could actually leave the ship open in a stronger market when it comes free again.
The source said booking vessels on shorter Middle East runs is viewed as risky, leaving ships in a very similar market open again.
Shorter voyage than two Middle East trips
Two Middle East deals at lower rates would also effectively tie up a tanker for longer than it would on the China run.
Middle East rates are quoted at between $11,000 to $13,000 per day for ships such as the Okeanis unit, on a TCE basis.
This made the current fixture the highest-earning voyage available.
A strong market rebound to healthy levels is expected in the medium term, perhaps as soon as May or June, the industry source said.
Clarksons Platou Securities said that if ultra-slow steaming is included on the ballast leg, and the fact that shipowners have cheaper bunkers in their fuel tanks — a VLCC only needs to fill up the tank every 100 days or so — net earnings are probably $4,500 per day higher than the $6,600 average.
No step down?
As the lower-priced fuel in tanks is exhausted, Clarksons Platou added that the incentive to ask for higher freight rates increases.
Crude oil shipments, based on tracking data from major exporters, indicate a steep fall in Opec exports in January versus December, driven by 1.6m barrels per day lower Saudi Arabian shipments before the announced production cut in February, the company said.
"In other words, the tanker market appears to have already felt the Saudi production cuts during January, hence we are not likely to face another step down in the next month as some people might fear, although there is probably not much upside either in terms of demand in the short term," Clarksons Platou said.
