Fearnleys Weekly Report – Week 51, 2022

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Credits: Venti Views/Unsplash

Fearnpulse summarizes the weekly tanker report for the 51st week of 2022.

VLCC

A negative swing for VLCC owners this past week, as rates have taken a 10-point dive across the board. A couple of deals done on ships that only have to calculate one leg (i.e., sold and delivered at the completion of discharge). Nonetheless, each enquiry received a dozen offers, and therefore each fixture will have 11 or so disappointed candidates. “Special reasons” or not the market is now set in the low-mid WS 70’s for MEG/East.

Charterers’ current tactics of sitting on hands and drip-feeding cargoes is working in their favour, hoping for someone to break ranks yet again as Christmas moves closer. However, judging from the January fixture count, and moving closer on the curve laycan wise, charterers could be creating a bottleneck for themselves with enquiry shoe-horned into the days between Christmas and New Year.

Suezmax

The Suezmax market has seen significant downward corrections in the Atlantic basin with most notably TD20 now trading at WS 147.5. Further softening is possible on the cards as several vessels are on the verge of missing the fixing window with owners unlikely to want FOC vessels languishing over the festive period.

The USG looks to have bottomed out as a number of TA deals concluded in and around WS 145 x WS 130’s with some potential upside in the offing. TD6 is all but done for the year with charterers bizarrely not willing to test the market despite the enormous differential with neighboring markets. In the East, it’s worth noting that the list is deceptively tight on the early side for modern tonnage, which puts a floor under MEG/China at WS 170 and a TD23 run not leaving much change from WS 85.

Aframax

The Nsea Aframax market slowed down on the back of increased Suezmax and VLCC tonnage fixing stems ex East Coast UK and West Coast Norway leaving less volumes to lift for their smaller siblings. Rates have started to come off and we expect this soft sentiment to continue into the new year fixing window.

More of the same in the Med/BSea market as a mix of Suezmaxes fixing Aframax stems, oversupply of Afras, and slower activity cut around 100 WS points for local runs. Owners accepted their fate and fixed lower, however they still earn decent returns. The last week of the year might be busy with charterers reaching forward and owners having the chance to prevail rates from losing more ground.

Read the full article here.

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Source: Fearnpulse

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