The Baltic Exchange continues to report dismal earnings for VLCCs, prompting Gibson Shipbrokers to wonder if it is time to change things up.

The time charter equivalent (TCE) rate earned by the largest tankers ticked up by $184 on Friday, but remains deep into the red at -$20,673 per day, an assessment that Gibson argues does not truly reflect the market.

“Evidently the majority of the VLCCs trading on the spot market are capable of generating higher returns than the benchmark Baltic Exchange VLCC description,” the broker said.

“So, this begs the question, is it now time to assess benchmark VLCC earnings on a different basis?”

Gibson said there are reasons VLCCs are being out-earned by their smaller counterparts, given the reshuffling of oil trades as Europe shunning Russian oil shortened tonne miles and created new opportunities for suezmaxes and aframaxes.

But it said the story is not as dire as the Baltic Exchange data makes it out to be. It said 42% of all VLCCs have scrubbers, helping them earn an $11,000 per day premium over their non-scrubber-fitted competition and enough to cover operating expenses.

Another 11% of ships are likely to be eco-designed, meaning they can burn less fuel and another 11% carry Iranian or Venezuelan cargoes, sanctioned trades that take them out of the above-board global market.

The Baltic Exchange calculates its VLCC time charter equivalent using routes from the Middle East Gulf to the US Gulf and to China and makes various assumptions, including speed and fuel consumption.

The assessment fell below zero in January 2021 and has not been in the black since, falling to an all-time low of -$27,893 per day on 10 March. Nine days prior, it hit a 14-month high of $2,301 per day.

Gibson is not the first to suggest the Baltic Exchange figures make things look worse than they really are.

In early February, analysts from Clarksons Platou Securities said the market was still poor, but that slower speeds helped lift rates, with an eco VLCC earning $6,800 per day and significantly lifted non-eco earnings, as well.

Overall, the analysts said VLCCs were earning $4,600 per day.

At that time, the Baltic Exchange pegged VLCC earnings at -$18,735 per day.

The Baltic Exchange could not be immediately reached after London business hours.