VLCC rates continue to peek up amid tight supply and high hopes for Atlantic basin crude production.
Clarksons’ fleet-weighted average for VLCCs hit $50,500 per day on Monday, a rise of nearly 15% from last week and 4% from last month.
The jump came, according to ABG Sundal Collier analyst Petter Haugen, “as the list contracted in the East and the West remained tight”.
Last Monday and Thursday were busy for the largest crude oil tankers, according to Tankers International, with Maran Tankers’ 321,000-dwt Maran Danae (built 2023) earning a $94,600 per day fixture for a voyage from the US Gulf to India for Total’s ATMI.
Thursday’s richest fixture was $54,800 per day for the 297,000-dwt Mermaid Hope (built 2011). The ship will carry crude for Trafigura from the Middle East Gulf to China.
The jumps come as Chinese refineries start to wind down their spring maintenance season, which typically runs into June.
Clarksons analyst Frode Morkedal pointed out that Opec+ is now expected to maintain its current production targets instead of raising them in the second half of the year as many hoped.
The widespread logic was that the bloc would raise production as prices rise, but Reuters pointed out in a report last week that crude stocks, futures prices and calendar spreads are all at similar levels to a year ago, making an increase less likely.
But, Morkedal said that “increased production from the Atlantic is introducing more long-haul barrels into the market, positively impacting both the [second and third quarter] outlook”.
“Chinese refineries near the end of their maintenance period in June, they are closely monitoring price differentials. With crude futures for July showing higher prices in China than in the Middle East and the US Gulf, we expect ton-mile demand to increase, supporting an upward trend in freight rates,” he said.
The Clarksons data shows the Middle East to China route rising the most week over week, rising just over 18% to $47,800 for an eco-designed VLCC.
But the West Africa to China route is the richest, with eco-designed ships plying that trade earning $49,500 per day and $51,600 per day with a scrubber.
