The VLCC markets responded in different ways this week with the Middle East and West Africa losing ground, but the US export market recovered.
VLCC Market Dynamics
The Very Large Crude Carrier (VLCC) market experienced a mixed week, with weakness in the Middle East and West Africa offset by a strong recovery in US exports, which has become a key market driver.
- Middle East Gulf to China (TD3C): The rate for the 270,000 mt route was volatile, initially dropping over 10 points before recovering 3 points by Thursday to WS72.17. This corresponds to a daily round-trip TCE of $56,800.
- West Africa to China (TD15): The Atlantic market saw the 260,000 mt rate slip to the mid-WS70s, but it ultimately recovered 3 points to WS78.31, resulting in a round voyage TCE of $64,220.
- US Gulf to China (TD22): This route showed significant strength, increasing by over $687,000 to nearly $10,300,000. This movement is supported by owners positioning vessels (ballasting) from the East to the West, and the rate reflects a daily round trip TCE of approximately $62,960.
Suezmax Market Strength
The Suezmax sector maintained a firm stance throughout the week, with the most significant gains observed in the Atlantic basin routes.
- Nigeria to UK Continent (TD20): The 130,000 mt rate is 7 points firmer compared to last Friday, settling at WS106.39. This translates to a daily round-trip TCE of $47,770.
- Guyana to UK Continent (TD27): This 130,000 mt route also saw a 7-point increase to WS102.78, providing a daily round trip TCE of a little over $45,200.
- CPC to Augusta (TD6): The rate for the 135,000 mt route moved up by 1.5 points to WS141.22, yielding a daily TCE of about $71,700.
- Middle East Gulf to the Mediterranean (TD23): The 140,000 mt route via the Suez Canal remained steady, hovering around the WS100 level.
Aframax Market Activity
The Aframax market saw relatively stable to firm conditions, with the trans-Atlantic route recording the strongest percentage gain.
- Cross-UK Continent (TD7): The 80,000 mt rate in the North Sea remained flat at WS140, providing a daily round-trip TCE just shy of $50,400.
- Cross-Mediterranean (TD19): This route for 80,000 mt crude improved by 7.5 points to nearly WS158, which shows a daily round trip TCE of just over $42,150.
- Trans-Atlantic (TD25): The 70,000 mt US Gulf to UK Continent route gained 8 points to around WS157.5, resulting in a round trip TCE of about $39,400 per day.
- Intra-Atlantic Routes: The 70,000 mt East Coast Mexico/US Gulf (TD26) route lost a point to WS145 (TCE of a little over $30,000), while the Covenas/US Gulf (TD9) route remained around the WS142 level (TCE of just under $28,900).
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Source: Baltic Exchange
