Following a long weekend, with London closed on Monday, the negative sentiment in the VLCC market has continued on from last week. MEG/east rates have dipped below the WS50 mark, and likely to be tested further, reports Fearnpulse.
VLCC
Charterers are by and large sitting on their hands and whether or not the 1st decade MEG September program is a wrap or not it nevertheless nourishes the perception that only crumbles remain. And with that the doom and gloom chatter increases in volume.
The picture is not improved by Atlantic volumes being behind the curve. But something has got to give and if VLCC cargoes from the likes of Wafr and USG do not materialise then logic dictates that the Suezmax segment will benefit. As politicians like to say to managed expectations; it could get worse before it gets better.
Suezmax
Last week saw Owner Sentiment gently nudge rates up in Wafr, Whilst this week, sentiment and improved fundamentals have converged. At the time of going to press, TD 20 trades minimum WS 80 with the fixing window focused on the 15-20 September window.
USG/TA has traded a couple of times at WS 70 before retreating back to WS 69.75. We think this is a momentary blip with rates likely to head back to WS 70’ish very soon.
In the East, the majority of activity is mainly short haul Indian cargoes which hasn’t been enough to thin out the list although rates remain stubbornly healthy with reported last done MEG/East at WS105 NHC. BOT/UKCM needs a test but should trade W50-55 COGH.
Aframax
Market remains stable rate wise with moderate activity pushing into the first decade. Tonnage remains balanced but with soft markets both in the Med and US and a relatively light North Sea program in the first decade, market looks like it will remain flat in the short term.
There is a softer feel in the Mediterranean Aframax market as rates slowly slip further and the lack of supply remains limited with Libyan exports remaining up in the air. Vessels continue to rotate back into position for the next window and so if force majeure is applied in Libya, then a further blow to rates will be seemingly inevitable.
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Source: Fearnpulse
