LR2 Freight: Navigating Turbulent Waters Amidst Tonnage Surplus



In the MEG this week LR2 freight lost steam as tonnage availability outstripped demand. The TC1 rate for 75kt MEG/Japan came down 37 points to WS194 and the 90kt MEG/UK-Continent TC20 voyage similarly went from $6.22 million to $5.68 million.

West of Suez, Mediterranean/East LR2’s held stable around the $4.25 million level (for the albeit short week).


In the MEG, LR’1 freight has also dropped this week. The 55kt MEG/Japan index of TC5 lost 10% of its value down to WS233. The 65kt MEG/UK-Continent of TC8 came off $256,000 to $4.69 million.

On the UK-Continent, the 60kt ARA/West Africa remained flat around the WS200 mark all week.


MR’s in the MEG saw enough activity to keep freight levels from really moving this week. TC17 35kt MEG/East Africa dipped five points from WS311 to WS306. The Baltic TCE for the run is still over the $30,000 per day round trip.

On the UK-Continent MR’s managed to resist downward pressure this week. The 37kt ARA/US-Atlantic coast of TC2 came down a modest single point to WS199. On a TC19 run (37kt ARA/West Africa) the index managed to climb ten points to WS230 after a widely reported market fixture around this level.

A week of downs for the USG MR’s over the last few days. TC14 (38kt US-Gulf/UK-Continent) shed 18 points down to WS206. The 38kt US Gulf/Brazil on TC18 went from WS311 to WS295 and the 38kt US-Gulf/Caribbean of TC21 managed to hold on over the $1 million level at around $1.1 million all week.


In the Mediterranean, 30kt Cross Mediterranean (TC6) had a 33 point chunk taken out of it to land at WS253.

Up in North West Europe, the TC23 30kt Cross UK-Continent remained sedate around the WS217.5 level.


The market was relatively static over the past week with the rate for 270,000 mt Middle East Gulf to China meagerly rising half a point to WS65.40 which corresponds to a daily round-trip TCE of $41,729 basis the Baltic Exchange’s vessel description.

Meanwhile, in the Atlantic market, the 260,000 mt West Africa/China route softened one point to WS65.72 showing a round voyage TCE of $42,479 per day. The rate for 270,000 mt US Gulf/China dropped $229,444 since last Thursday to $8,515,000 providing a round-trip daily TCE of $40,328.


The Suezmax market in West Africa was quiet this week, but support for owners came from the improving US Gulf and Caribbean export market. For the 130,000 mt Nigeria/UK Continent voyage rates fell by four points to WS106.22 (a daily round-trip TCE of $39,012). In the Mediterranean and Black Sea region rates remained flat, hovering just above WS109 for 135,000 mt CPC/Mediterranean trip (showing a daily TCE of a little over $37,000 round-trip). In the Middle East, the rate for 140,000 mt Middle East Gulf to the Mediterranean (via the Suez Canal) was assessed two points firmer at just below WS100.


In the North Sea, the rate for the 80,000 mt Cross-UK Continent slipped five points to WS131.79 (a daily round-trip TCE of $30,850 basis Hound Point to Wilhelmshaven).

In the Mediterranean market the rate for 80,000 mt Cross-Mediterranean has improved by three points to WS167.67 (basis Ceyhan to Lavera, that shows a daily round trip TCE of $46,130).

Across the Atlantic, the Stateside market has had a reversal of fortunes with the rate for 70,000 mt East Coast Mexico/US Gulf (TD26) climbing ten points to WS145.31 (a daily TCE of $26,588 round trip) and the rate for 70,000 mt Covenas/US Gulf (TD9) rose six points to just shy of WS140 (a round-trip TCE of close to $24,000 per day). The rate for the trans-Atlantic route of 70,000 mt US Gulf/UK Continent (TD25) recovered 28 points to WS175.56 (a round trip TCE basis Houston/Rotterdam of $39,008 per day).

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Source: balticexchange