- VLCC markets in the Middle East and West Africa showed signs of recovery, with firming sentiment driven by steady enquiry and improving AG rates.
- LR2s in the Middle East led the clean products sector with strong midweek gains, while UKC and Med MR markets eased back to pre-spike levels.
- Dirty products saw softer Handy rates in the Mediterranean and steady levels in the UKC, with MR sentiment mixed across regions.
- Panamax activity remained subdued in the Atlantic, while the US Gulf saw early-week softness followed by gradual improvement.
Major buyers of Russian commodities such as India, China, Turkey, and Brazil have so far managed to balance relations between the US, EU, and Russia, benefiting from discounted Russian energy while maintaining trade with the West. However, shifting geopolitical developments and new sanctions could soon force these nations to make difficult choices. According to a recent report by Gibson, upcoming policy measures may reshape global oil trade flows and increase volatility in the tanker market.
Crude Oil Market
In the Middle East, the VLCC market began the week on a slow note, with freight levels under pressure as a well-supplied tonnage list gave charterers plenty of choice. While visible enquiry was limited, private fixtures gradually reduced availability. Midweek sentiment improved slightly after a market cargo lifted rates, and by week’s end activity had picked up to a steady pace. If current enquiry levels hold, an upward shift could be seen early next week, with AG/China assessed at WS45.
Suezmax activity in the East was relatively strong, with firm sentiment as owners aim for over 140 x WS47.5 via C/C for westbound voyages. Eastbound runs are also holding firm and could exceed 130 x WS100 next week. In contrast, the Asian Aframax market remained subdued, with earnings slipping to just above $20,000/day—down about 25% over the past month. Ample tonnage continues to weigh on sentiment, though a stronger Atlantic market may attract some owners to ballast westward. Indo/Oz is currently assessed at 80 x WS107.5.
In West Africa, VLCC activity increased toward the end of the week, though rates have yet to show gains. With AG markets improving, there is optimism for upward pressure, and WAF/East stands at WS50.5. Suezmaxes remain firm, with owners targeting above WS82.5 for TD20 and maintaining a 10-point premium for Eastbound voyages.
The Mediterranean Suezmax market has firmed, with limited availability in the East Med likely to push TD6 to WS105. Rates for Med-East remain less tested but are estimated at around $4.6 million for Libya/Ningbo. Aframax sentiment strengthened as Libyan and Ceyhan cargoes cleared, aided by overlapping US activity, pushing Ceyhan rates to WS150. While firm sentiment is expected to continue, gains may be capped as larger vessels absorb some demand.
In the Americas, the VLCC market stayed quiet, with balanced tonnage and limited fresh enquiry keeping rates steady. Brazil exports were more active but have not yet seen an owner’s advantage. USG/China is assessed at $6.8 million, and Brazil/East at WS49.5. In the North Sea, Aframax activity picked up, supported by a strong US market, with moderate gains so far and potential for more early next week.
Clean Products Market
In the Middle East, MR activity strengthened midweek, pushing rates up by around 20 points, but enquiry has since slowed. The front end of the list remains tight, though current levels appear to be peaking, with a correction likely ahead. LR2s led the week’s activity, with strong demand in the first half driving TC1 to WS145, and the next fixtures expected near WS150. Westbound runs are nearing $4.0 million, with further gains possible as later stems enter the market. LR1s remain tight on tonnage, though longer-haul volumes have been limited. TC5 has followed TC1 upward, reaching WS155 and potentially moving to WS160, while 60kt Jet AG/UKC now exceeds $3.0 million, with $3.1–3.2 million expected next.
In the UK Continent, MR market pressure eased, returning to pre-spike levels as a healthy tonnage list and seasonally slower export volumes weighed on sentiment. August is expected to remain flat, although unseasonal Atlantic weather could cause temporary delays. Russian participation in the market may also increase as oil exports slow. Handysize activity in the North Sea held steady, with XUKC at 30 x WS155 and UKC/Med at 30 x WS145. While the front end of the list has tightened slightly, owners remain mindful of softer MR sentiment and competition from larger vessels.
In the Mediterranean, MR rates remained steady, with 37 x WS127.5 repeated for Med–Transatlantic voyages. A tighter front end and several vessels going on subs suggest possible upward pressure, though this will depend on tonnage availability early next week. Handysize rates for TC6 improved early in the week and stabilized at 30 x WS185. Despite a thinner tonnage list, owners appear content to maintain current levels, aiming for market stability while selectively pursuing prompt opportunities.
Dirty Products Market
In the UK Continent Handy market, enquiry remained limited throughout the week. Monday’s list showed tight availability, but minimal midweek activity allowed positions to build, shifting sentiment from firm to steady. Most fixtures were concluded at 30 x WS240, repeating last done levels. The week closed quietly, with modern units likely to feature in early next week’s fixing windows. Sentiment is expected to remain steady, though a prompt start in enquiry will be key.
In the Mediterranean, slow early-week activity left enquiry struggling to clear tonnage, with a notable imbalance between a plentiful East Med list and a thinner West Med supply. Sentiment turned softer as rates slipped from WS235 for standard XMed voyages to WS230 by week’s end. Discreet fixing and premium Black Sea cargoes helped trim availability, but with new units set to open over the weekend, further pressure on levels is possible.
For MRs, both the North and Mediterranean saw limited full-stem activity. In the North, early tightness eased after O/P and part cargo fixtures cleared available units. The list remains short, and next done is expected to firm toward 45 x WS170. In the Med, rates fell from WS165, softening by another 2.5 points, though balanced tonnage has helped stabilize sentiment for now.
Panamax activity stayed muted in the Atlantic, with levels around 55 x WS110 yet to be tested as back-haul opportunities remain scarce. In the US Gulf, TD21 began the week quietly, with rates easing toward WS240 before finding support as enquiry picked up and vessels were fixed away. Owners will be looking for this momentum to continue to drive further recovery.
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Source: Gibson
