Tanker Market Remains Steady With Mixed Trends Across Segments

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  • The tanker market exhibits a lackluster performance, with VLCC activity remaining sluggish in the Middle East Gulf as April and May cargo dates overlap.
  • Meanwhile, the Atlantic sees tightness in available tonnage and slight rate increases for the US Gulf to Ningbo route.
  • Suezmax rates have cooled off after last week’s spike in the Atlantic, and a softer feel emerges as May laycans come into view.
  • Aframax rates have increased in some areas due to higher activity covering later dates, but sentiment may shift if more vessels return to position.
  • In the Mediterranean, slower inquiry and increased competition may apply downward pressure on rates.
  • Despite some fluctuations, the overall tanker market maintains a steady state.

The tanker market is showing mixed trends across different segments, with some areas of the market experiencing a lackluster performance while others display signs of improvement. In general, the market remains steady, with steady rates and fluctuations based on regional activity and supply and demand dynamics.

VLCC Activity Sluggish in the Middle East Gulf

The VLCC segment experienced a lackluster week in the Middle East Gulf as the market adjusted to the overlap of April and May cargo dates. Present levels in the market remain in the low WS 60s, creating a balance for charterers and operators. Despite the equilibrium, charterers active in the market are moving slowly and countering up the WS 50s, possibly aiming to drag rates down. There is anticipation of a potential early May rush in cargo bookings.

In the Atlantic, the market faces tightness in available tonnage due to few Eastern ballasters. US Gulf to Ningbo rates picked up approximately USD 250,000 over the week but have since quietened. Additionally, Shell has been active from Brazil, reportedly taking four ships for the first half of May, although the impact on the market remains subdued.

Suezmax Rates Cooled Off

After last week’s spike in the Atlantic, Suezmax enquiry rates have cooled off. In West Africa, about 21 million barrels were penciled in to lift for the first decade of May, of which 16 million barrels were lifted on VLCCs and 2 million on Suezmax vessels. This leaves a maximum of three stems to lift in that timeframe. The US Gulf appears more insulated against drastic softening for prompt laycans, but as May dates approach, the list may become less favorable for charterers.

The East has been in slow mode for over a month now, and despite the list not being the longest, a softer feel emerges as the week progresses.

Aframax Rates on the Rise

Aframax rates have increased due to higher activity covering the third decade of the month. This push has raised rates to WS 150 levels, while a lack of natural North Sea tonnage has limited the options available for charterers. Although a lower reported fixture has affected sentiment, the tonnage list remains tight. The Mediterranean market shows some activity, and with forward tonnage available to meet upcoming demand, competition may apply downward pressure on rates.

In the Mediterranean, the market has seen initial slower inquiry followed by a rise in activity, as final North Africa opportunities close out. With April stems ex-CPC and Ceyhan complete, May laycans are now the focus. Forward tonnage is expected to meet demand, keeping rates stable in the short term.

Rates and Forward Outlook

Despite some fluctuations in rates and regional market dynamics, the overall tanker market remains steady, with mixed trends across segments. Looking ahead, the market may face gradual adjustments as supply and demand continue to dictate the balance and direction of rates in the coming weeks.

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Source:Fearnpulse