The crude tanker market softened across the board this week, as extended holidays, growing tonnage lists, and limited enquiry weighed on sentiment. VLCCs saw a notable dip on key routes, while Suezmax and Aframax segments continued to grapple with oversupply and muted fundamentals.
VLCC: Charterers Regain Control as Owners Lose Momentum
After a bullish run in previous weeks, VLCC owners blinked first amid a quiet start to the week, compounded by the bank holiday. With charterers allowing the tonnage list to build, TD3C rates slipped from WS 70 into the low WS 60s, dragging down sentiment.
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Key Routes:
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MEG/West (TD15): WS 32.5 (▼5)
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MEG/Japan (TD3C): WS 63 (▼7)
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MEG/Singapore: WS 64 (▼7)
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Outlook: Increased ballasting toward the US Gulf and OPEC+ cuts unwinding in June may stabilize demand-supply balance and offer owners some relief.
Suezmax: Pressured by Prompt Tonnage and Eroding Sentiment
Suezmaxes witnessed a pronounced drop in rates, especially in the US Gulf and West Africa, as prompt replacements highlighted market weakness. Softness in transatlantic flows and a stubbornly long tonnage list further eroded owners’ bargaining power.
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Key Routes:
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WAF/USAC: WS 85 (▼22.5)
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Sidi Kerir/W Med: WS 100 (▼15)
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Fixing Activity: Levels like 145×85 to replace a 95 fixture underscore the decline, with Aframaxes dipping to 145×72.5.
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Outlook: With the third decade of May forcing activity, some optimism remains, especially as VLCCs become less competitive. However, overtonnaged East of Suez and bearish TD6 prospects continue to weigh.
Aframax: Patchy Rebounds Amid Tonnage Pressure
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North Sea: After the long weekend, ballasting toward the US Gulf and Mediterranean picked up, though relets and larger ships limited natural fixing.
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Mediterranean: Prompt cargoes gave the market a head start, but growing competition from North Sea ballasters and limited new enquiry kept rates under pressure.
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Key Routes:
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N. Africa/Euromed: WS 162.5 (▼12.5)
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UK/Continent: WS 125 (▼12.5)
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Caribs/USG: WS 162.5 (▼17.5)
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Outlook: Supply-side saturation remains the main drag, with more ballasters likely and dates pushing forward.
1-Year Time Charter (ECO/Scrubber)
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VLCC: $51,000/day (▲ $500)
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Suezmax: $37,500/day (▲ $1,500)
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Aframax: $28,500/day (▼ $1,000)
VLCC Activity Snapshot
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Fixed last week: 34 (▼17)
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Available in MEG (next 30 days): 147 units
Crude tanker markets are in a retracement phase after recent gains, particularly on the VLCC side. The softening of key routes and increasing prompt availability are limiting rate support across all segments. As the market shifts deeper into the third decade of May, tonnage management and demand clarity—particularly from East of Suez and West Africa—will be critical to stabilizing sentiment.
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Source: Fearnleys