All bad news for VLCC owners
RETURNS for owners trading very large crude carriers (VLCCs) out of the Middle East Gulf last week continued to be abysmal, with older, high-consumption, steam-turbine vessels earning the timecharter equivalents of about US$3,500 to $4,000 a day on voyages to the east.
The week's fixtures amply confirmed predictions, as of the 20 vessels of five million tonnes fixed out of the Middle East Gulf, the breakdown has been 13 to Eastern destinations, four to the West, two to South Africa, and one of the Red Sea.
In spite of the fact that this is an overall increase in activity compared with the previous week, there still remain 82 vessels of 24 million deadweight tonnes available during the next four weeks, a figure comparable with that for the preceding four weeks.
The overall rate pattern from the Middle East Gulf showed marginal variations with VLCC-size vessels fixing to the West at Worldscale (WS) 37.5 to WS40 while Brazil was closing at WS39, South Africa at WS40, and as low as WS35 being reported to the Red Sea.
With the majority of fixtures being arranged to the East, the level, on average, for Korea, Singapore and China was in a range of the high WS30s and low WS40s, with Japan again paying the highest at WS43.
There were no reported fixtures of ULCCs.
Although a small market existed for the 75,000 tonne to 80,000-tonne vessel from the Middle East, there have been plenty of these fixed out of Indonesia, mainly nantly to the East, where rates of WS110 to WS112.5 have become the norm.
The take-up of VLCCs out of West Africa increased last week with several units being employed, mainly to the United States, where rates averaged between WS50 and WS52.5.
It was encouraging to see that the fixing of these vessels did not inhibit the utilisation of the more average-size units, with numerous fixtures concluded to the US where the rate stood at between WS80 and WS82.5, depending on destination.
Little differential was discernible in rate levels between last week and the previous week for 80,000 tonners trading in the Mediterranean, with the cross-Med and Continent rates varying between WS97.5 and WS100.
The million-barrel tankers fixing out of the Black Sea to UK-Continent and Mediterranean were closing at WS65 to WS70.
Black oil carriers operating out of the Caribbean and east-coast Mexico did not enjoy such bullish rates despite active trading conditions whereby vessels of about 80,000 tonnes were getting WS 125 to WS127.5 from both to the US Gulf and US Atlantic coast.
In the trans-Atlantic trades, a level of WS87.5 was registered on an 82,000 tonner.
There was nothing to shout about in the UK North Sea trade, but larger-size vessels which predominated last week, with VLCCs being closed to the US Gulf at WS52.5 and to the Mediterranean at WS51.
Similar movements, loading in Norway, were fixed at WS47.5. Report supplied by London ship broker E.A. Gibson.