French shipbroker BRS believes suffering VLCC owners are now likely to kick back against rock-bottom rates as bunker prices rise.
Brokers and analysts have already noted a return to notionally negative rates for older, non-scrubber-fitted tankers, while earnings for modern ships remain positive at low levels.
BRS called the last week a "bleak outcome" for owners as fundamentals continued to come under pressure, with tonnage lists being far too ample in the Middle East.
With the balance of January stems needing coverage, charterers were able to repeat rates of around Worldscale (WS) 36.5 from one fixture to the next without much fuss, the French shop said.
This is about $4,500 per day for eco ships and minus $4,400 for their older sisters.
And with fuel costs rising all the time and "chewing heavily" into earnings, resistance is likely to kick in, and a theoretical bottom may have been reached, BRS added.
West Africa saw a similar trend, with rates being tested downward at WS 38.
An "early market tester" fixture came out at WS 39, BRS said, for tight dates, but the market quickly felt the softening trend and rates dropped a point.
"The overall sentiment here remains soft and with tonnage ample for natural dates, expect the market to remain flat too," the broker added.
Suezmaxes also suffering
Suezmax owners have also enjoyed a "terrible start" to the year, the company said.
A flurry of cargoes have been logged in the last two weeks, but rates have still fallen to what could be the bottom, the broker believes.
In West Africa, a lengthy tonnage list populated by vessels ballasting in allowed charterers to push numbers down to WS 52.5, leaving time charter equivalent earnings for non-eco ships close to $3,000 per day.
Black Sea and Mediterranean markets experienced a similar downward pressure as natural suezmax cargoes were rare.
Owners of the million-barrel tankers were eyeing aframax cargoes to provide a safety net for a while, BRS noted.
Rising bunker costs for ships loading Brazilian exports have prompted owners to show some "minor resistance", with returns for voyages to Europe approaching negative figures, the brokerage said.
"Yet the long tonnage list is not playing in their favour," the company added.
"Overall, there is nowhere to turn — rates must rise to bring earnings positive at these bunker levels," BRS concluded.
