Some Greek owners are fixing out VLCCs on period charters from one to five years amid increased appetite from oil firms for long-term deals, market sources said.
Brokers reported Equinor tentatively chartered the 299,200-dwt Seatriumph (built 2017) from Thenamaris for 12 months at $29,000 per day last week.
If the deal materialises, the scrubber-fitted ship would be delivered in East Asia in mid-December.
TradeWinds has approached Equinor and Thenamaris for comment.
“This [fixture] suggests that rates for the end of this year and first quarter next year will be ‘weak’. More positive overtures should be expected as we enter the latter half of 2021 and beyond,” brokerage Braemar ACM commented in a note.
Evangelos Pistiolis-led Central Group also reportedly put two of its four scrubber-fitted VLCC newbuildings on three-year charters at $36,000 per day.
Trafigura has chartered the 300,000-dwt Julius Caesar and US-based Koch Industries booked the sistership Legio X Equestris.
The ships will be Central’s first VLCCs when they are delivered from Hyundai Heavy Industries in 2022.
The deals can be extended for a fourth year at $37,500 per day and a fifth at $41,000 per day, according to brokers.
However, a source close to the shipowner told TradeWinds that the charters are yet to be concluded and declined to provide further details.
Trafigura separately was also reported to have fixed the 320,000-dwt newbuilding Serendipity for 18 months at $34,000 per day, and the scrubber-fitted, 299,000-dwt SC Hunan for one year at $35,000 per day. Both ships are due for delivery next year.
Last month, the trading giant chartered the 300,000-dwt, scrubber-fitted Hunter – due to be delivered from Hyundai Samho Heavy Industries in 2021 – from Evalend Shipping for at least 12 months at $29,000 per day.
Recovery mode?
Oil firms are showing more interest in taking tankers on long-term charters this month, with both spot and period rates showing signs of bottoming, according to some brokers and owners.
Clarksons Research estimates the current rate for a one-year charter of an eco VLCC at $29,250 per day, up from $25,500 two weeks ago. A three-year rate increased to $31,375 per day from $30,625.
But charterers are only willing to offer small premiums for scrubber-fitted tonnage because of the narrow spread between high sulphur and very low-sulphur fuel oil (VLSFO).
“The Covid-19 pandemic has … had an impact on VLSFO by increasing supply and lowering prices as demand for fuel has been hit dramatically by global lockdowns,” brokerage Alibra Shipping said in a note.
Most analysts believe tanker rates in general will have limited upside for the next six to 12 months due to weak supply-demand fundamentals.
“Recent news on vaccines has of course been positive and will support a rapid recovery in oil demand in 2021,” Maritime Strategies International’s director for oil and tanker markets Tim Smith said. “However, the immediate effects for tanker markets may not be as beneficial.
“Continued stock draws, Opec+ restraint, reduced operational disruption and lower floating storage will be detrimental to market fundamentals. We expect the market will continue to be put under pressure next year.”
