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VLCC, Suezmax, and Aframax Rates Fell Steeply in Week 4 of 2018

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Updated

VLCC rates

According to Weber’s weekly report, VLCC (very large crude carrier) fundamentals weakened considerably in last week. Souring fundamentals pushed the rates down. We saw a very slow demand environment at the start of the week, and VLCC rates concluded around year-to-date lows.

According to Weber’s Week 4 report, VLCC rates for the route from the Arabian Gulf to China dropped to $10,925 per day on January 26 from $18,389 per day on January 19, which represents a 40% fall week-over-week. The average rate for all VLCC routes dropped to $13,179 per day from $19,974 per day on January 19. The current rates are 67% lower year-over-year. Euronav (EURN) and DHT Holdings (DHT) mainly operate VLCCs.

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Suezmax rates

According to Weber’s weekly report, Suezmax rates in the West African market posted new losses last week on a growing availability surplus. Suezmax rates on the route from West Africa to the United Kingdom dropped 76% from $3,479 per day on January 19 to $832 per day on January 26. The average Suezmax rates dropped to $2,654 per day on January 26 from $4,839 per day from the previous week.

Teekay Tankers (TNK) and Tsakos Energy Navigation (TNP) have Suezmax vessels in their fleets. Nordic American Tankers (NAT) operates only Suezmax vessels.

Aframax rates

The Caribbean Aframax market was markedly softer last week due to sluggish demand and a growing surplus. Aframax rates on the Caribbean route were down from $14,210 per day on January 19 to $4,000 per day. The average Aframax rates dropped from $14,370 per day on January 19 to $10,647 per day on January 12.

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