ALTHOUGH fixing last week was about recent levels, there has been a marked improvement in rates.
Some 14 very large crude carriers (VLCCs) and one ultra-large crude carrier (ULCC) were fixed during the week, totalling around four million tonnes, but the majority of this came in the last three days, putting pressure on rates.
As a consequence, rates for VLCCs moves from Worldscale (WS)40 to WS 45 for US Gulf discharge and from WS 42.5 to WS 47.5 for European discharge.
Rates to the East for the two-million barrel size tonnage also have shown improvement, and the last reported fixture was of a Japanese re-let at WS 44.
This movement in rates indicates again the finely balanced market in the Middle East Gulf for larger units.
Despite the boost, about 16 million tonnes is expected to be available in this area during the next 30 days, putting paid to hopes of any slight increase causing a shortfall and further increasing rate levels.
Enquiry in West Africa for Suezmax tonnage has been disappointing and, as a result, rate levels have gradually fallen. The latest fixture of a one-million barrel vessel to the US Gulf was reportedly below WS 70, five points less than the level ruling two weeks ago.
Tonnage in the Mediterranean has had a week of mixed fortunes. On the one hand, Suezmax tonnage has found it difficult to maintain rates obtained last week and the most recent fixture reported for a cross-Med voyage was around WS 75, some 10 points lower.
Aframax tonnage, however, has been split into two markets, with newer tonnage commanding premiums of between 10 and 15 points over older vessels.
Caribbean activity has once again been brisk and tonnage, particularly Aframax, has been able to push rates close to WS 170 for cargoes of 70,000 tonnes destined to the US Gulf - 30 points in excess of the rates ruling at the start of the week.
The beginning of the week saw a reasonable amount of fresh enquiry in the North Sea basin, particularly for Aframax tonnage trading within the UK-Continent. Rate levels have been established firmly at WS 105 for cargoes of 80,000 tonnes, up five points from last week.
One VLCC has been reported as fixed for a cargo destined for the US Gulf at WS 45.
The overall product market has shown a slight improvement in rates in some areas.
The Middle East Gulf probably fared least favourably than other areas, tonnage only being able to maintain levels.
Vessels able to carry lots of between 55,000 and 80,000 tonnes are being fixed to the Far East at between WS 117.5 and WS 120. With tonnage availability beginning to thin and little of it being available prior to the second half of next month, owners aresure to hold for higher levels next week.
Smaller units trading to the Indian peninsula have had more immediate success and levels are 10 points over those last week and now stand at about WS 150 for lots of 30,000 tonnes. Report supplied by London ship broker E.A. Gibson.