Germany’s Hammonia Schiffsholding has secured a potential five-year charter for its only crude tanker from Swedish giant Stena Bulk.
Stena has agreed to charter the 156,900-dwt Aura M (built 2020) for an initial three-year period plus options for a further two years.
It has agreed to pay a base rate of $28,000 per day plus a profit split measured by the revenue from the revenue pool in which the ship is employed, Hammonia said.
The suezmax was previously fixed to Trafigura, a charter that expired at the beginning of May.
The vessel was initially earning $31,500 under a 14-month charter to the commodity giant, which later exercised an option to extend it by six months at $35,000 per day.
There is a developing trend in the tanker market in which increased focus is placed on longer time charters, as participants seek greater clarity on freight exposure over the medium term, according to Ifchor Galbraiths.
Every segment of the tanker fleet from VLCC to handy is said to have experienced multi-year increases in the average length of time charter, with that average peaking so far throughout the first quarter of 2024.
“The suezmax fleet is a textbook example of this trend, where average time charter duration sat at just under 1.5 years in 2019, with it now sitting at just shy of an average of three years so far in 2024,” Ifchor Galbraiths said in a research note.
“Across 2023/2024 a total of just over 40% of reported time charter fixtures were of at least three years duration, a dramatic increase compared to the 23.75% of reported fixtures seen across the longer time frame of 2000/2022.”
Ifchor Galbraiths says this trend is mirrored in the wider tanker fleet, where for the first time since 2009 average time charter duration has increased past the two-year mark, sitting at an average of 2.03 years.
“The increasing durations have seen a cumulative total of just over 920 years of time charters across 2023 and the first part of 2024, with oil majors/traders taking a significant chunk of that business,” the broker said.
“With this increase in vessels locked on time charter, the pool of tonnage across the tanker market willing to do time charter business is shrinking significantly, a tightness exacerbated by the limited new tonnage coming into the market over the near term.”
Hammonia acquired the Jiangsu New Yangzijiang-built tanker in early 2020 on a long-term bareboat charter from Hong Kong leasing company Seacon Shipping Group in a punt on the tanker market.
It has an option to buy the vessel after five years for $29m.
The company’s other tankers include the 49,700-dwt Hammonia Artemis (built 2016) and 49,500-dwt Hammonia Athene (built 2015), which are part-way through five-year charters to Weco Tankers.
Hammonia’s fleet includes two feeder container ships — the 2,798-teu Hammonia Baltic (built 2011) and 3,091-teu Lutetia (built 2005).
