Downward Pressure On MEG LR2’s: Significant Drops In TC1 And TC20 Rates LR2



MEG LR2’s were subject to downward pressure this week. The TC1 rate for 75Kt MEG/Japan dropped 17.5 points to WS180.56 and the 90kt MEG/UK-Continent TC20 voyage is went from $6.08m to $5.89m. West of Suez, Mediterranean/East LR2’s continued to be sedate this week. The TC15 index remained level around $3.5m.


In the MEG, LR1’s were seemingly unaffected by the drop affecting their larger sisters this week. The 55kt MEG/Japan index of TC5 trundled along in the WS230’s and the 65kt MEG/UK-Continent of TC8 went from $4.61m to $4.85m. On the UK-Continent, a 60Kt ARA/West Africa run on TC16 came down 8% to WS142.22 taking the Baltic TCE for the run to $35,306/day round trip.


MR’s in the MEG eventually came down, holding early in the week at around the WS340 level but a mid-week fixture much lower drove the index down 23.21 points to WS312.86 at present. On the UK-Continent MR’s began to optimistically resurge this week. The 37kt ARA/USAtlantic coast of TC2 hopped up 30 points to WS182.19 or a Baltic round trip TCE of $19,944/day. The TC19 run (37kt ARA/West Africa) also went from WS174.06 to WS202.19. As USG MR’s continued their firm charge upwards this week. TC14 (38kt US-Gulf/UKContinent) shot up 37.14 points to WS238.57. The 38kt US Gulf/Brazil on TC18 went from WS300.71to WS342.14 and the 38kt US-Gulf/Caribbean of TC21 jumped up 40% to $1.45m returning $65,000/day on Baltic description round trip TCE. The MR Atlantic Triangulation Basket TCE climbed 28% to $46,085.


In the Mediterranean, 30kt Cross Mediterranean (TC6) climbed back up to the tune of 37.5 points to its current mark of WS182.5. In northwest Europe, the TC23 30kt Cross UK-Continent also hopped up from WS164.72 to WS177.22.


The VLCC market remained relatively stable this week, with the rate for the benchmark 270,000mt Middle East Gulf to China climbing a modest 0.15 points to WS49.7, which gives a daily round-trip TCE of $26,135 basis the Baltic Exchange’s vessel description.

In the Atlantic, the market was very similar to the Middle East Gulf. The 260,000mt West Africa to China ultimately climbed to WS55.34 (+0.38) showing a round voyage TCE of $32,876/day, and the rate for 270,000mt US Gulf to China dropped by $180,000 to $7,760,000 making a round-trip daily TCE of $35,654.


The Suezmax market in West Africa and the Mediterranean/Black Sea region have been flat/soft this week. The rate for 130,000mt Nigeria to UK Continent fell from the WS112.5 level to WS109.83 (a daily round-trip TCE of around $42,859) and the 135,000mt CPC/Mediterranean route held resolute around the WS120 mark (showing a daily TCE of $47,709 round-trip). In the Middle East, the rate for 140,000mt Middle East Gulf to the Mediterranean (via the Suez Canal) was stable at around the WS94-95 mark.


In the North Sea, the rate for the 80,000mt Cross-UK Continent dropped another 10.41 points to WS157.92 (a daily round-trip TCE of $53,679 basis Hound Point to Wilhelmshaven).

In the Mediterranean market the rate for 80,000mt Cross-Mediterranean picked up 6.77 points this week to WS153.33 off the back of some improved activity, (basis Ceyhan to Lavera, that shows a daily round trip TCE of $40,450).

Across the Atlantic, negative sentiment, regrettably for owners, continued this week. For the 70,000mt East Coast Mexico/US Gulf (TD26) the rate sunk 45.62 points to WS176.88 (a daily TCE of $42,032 round trip) and the rate for 70,000mt Covenas/US Gulf (TD9) was 40 points softer at WS174.38 (a round-trip TCE of $38,861/day). The rate for the trans-Atlantic route of 70,000mt US Gulf/UK Continent (TD25) fell another 14.72 points to WS172.78 (a round trip TCE basis Houston/Rotterdam of $39,580/day).

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Source: balticexchange