The VLCC market continued to improve across all regions this week, aided by higher rates from the Middle East Gulf to China.
Latest rates are up 35% on the week and 16% on the month at $33,800 per day, according to Clarksons, having reached a peak of $36,100 last Thursday.
In the year to date, the average VLCC rate is $42,000 per day, some way behind 2023’s $51,200 per day.
The market strengthened with rates on the Middle East Gulf to China route rising to WS 54.5, despite enquiry slowing down in the Gulf towards the end of the week, Clarksons added.
“The doom and gloom of the past few weeks quickly dissipating over the last few days, as Middle East Gulf rates improving by 40%, and the swinging WS 60’s potentially in view,” said Fearnleys Securities.
The 270,000 tonnes Middle East Gulf to China trip rose six points to WS 58.8, corresponding to a daily round-trip time charter equivalent of $36,358 basis on the Baltic Exchange’s vessel description.
“The usual busier start to the month meant charterers fell over themselves chasing tonnage and owners were able to help each other out by leaking deals into an increasingly warming market,” added Fearnleys.
It said to expect a Chinese freeze on anything before mid-month August laycans in an effort to cool the market, and some profit taking on prompter dates is likely.
“But sentiment is strong right now and we count just 27 vessels free of cargo in the East at this moment in time,” Fearnleys said.
In the Atlantic market, the rate for 260,000 tonnes West Africa to China climbed 4.5 points to WS 59.83, which shows a round voyage TCE of $37,885 per day.
The rate for 270,000 tonnes US Gulf to China was pushed up $222,500 to $7,460,000 ($33,789 per day round trip TCE), according to the Baltic Exchange.
“In the Atlantic, the earlier vessels booked what they can, minimising waiting, and a lack of ballasters from the East means this market may continue an upward trajectory in the short term,” Fearnleys said.
However, Clarksons indicated that rates do have the potential to soften this week as sentiment falters amid minimal support from the Atlantic market.
