Sales of secondhand VLCCs hit their highest monthly level in at least three years during May, according to a top shipbroker.

Despite global fears over the cost of living, falling equity values and the on-going war in Ukraine, a total of 17 VLCCs changed hands last month

“Although secondhand prices continued to rise, there was significant interest in the larger sized tankers last month,” said Affinity (Shipping).

“There were also nine aframax sales, the most since April 2021, as owners sought to position themselves for the crude oil tanker market recovery before prices rise too high.

“As the product tanker market continues to soar, owners believe that the crude market will inevitably follow,” the shipbroker added.

Affinity said the strength of the freight market on the product side encouraged “plenty of interest”, with six LR2 transactions in May, the most since the eight sold in July 2021.

The number of MRs changing hands was down month-on-month – from 21 down to 18 –but it was still the second-highest tally in the past 14 months, the broker said.

“Product tankers continue to attract plenty of interest, and the handysizes remain extremely popular, with another seven sold last month, matching April’s total,” Affinity said.

Richard Fulford-Smith-led Affinity Shipping said that although secondhand prices continued to rise, there was significant interest in the larger sized tankers in May. Photo: TradeWinds Events

In all, 61 tankers were reportedly sold in May, the highest monthly tally since April 2021, and this was an increase of 17% on the year — the first year-on-year rise since November 2021.

Although freight rates have seemingly plateaued in the dry bulk markets, there was still “firm interest” in the secondhand market last month, Affinity said.

May saw a total of 73 bulkers sold in the secondhand market, two up on April’s total of 71, but fewer than the 80 seen in March.

Affinity said the smaller sizes continued to “garner the greater interest”, as they continue to outperform the larger sizes.

Seventeen handysizes were sold last month, compared to 13 in April, while 18 supramaxes were also sold, marginally fewer than the preceding months.

“Capesizes were also popular last month, with seven sold, as sentiment remains positive, meanwhile10 panamaxes were sold, too, the most since June last year,” Affinity said.

In contrast, scrapping in both the tanker and bulker markets remained slow as owners preferred to hold onto their tonnage.

A total of eight tankers were scrapped in May, the second-lowest number of scrapped vessels over the last 13 months, Affinity said.

Suezmaxes led the way, with four vessels scrapped last month, compared to just two in April 2022. But it was still the most in a single calendar month since August 2018.

Just two dry bulk vessels were scrapped in May — a capesize and a handysize bulker — matching April’s total, the broker said.