uploads///Spot Rates_Week

Week 10: Where Are Crude Tanker Rates Heading?

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Mar. 15 2018, Updated 7:32 a.m. ET

VLCC rates

According to Weber’s weekly report, VLCC (very large crude carrier) rates commenced week 10, the week ending March 9, 2018, with modest gains due to a slight improvement in supply-demand fundamentals. However, the rate increase was short-lived. The Middle East market was less active, which offset any positive sentiment.

According to the same report, VLCC rates for the route from the Arabian Gulf to China rose slightly to $7,766 per day on March 9 from $7,294 per day on March 2. The average rate for all VLCC routes dropped from $10,574 per day on February 23 to $9,190 per day on March 9. The current rates are 60% lower year-over-year. In 4Q17, Euronav (EURN) earned a spot rate of $25,889 per day for its VLCCs. During the same period, DHT Holdings (DHT) earned a spot rate of $19,600 per day for its VLCCs.

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Suezmax rates

According to Weber’s weekly report, Suezmax rates on the route from West Africa to the United Kingdom dropped from $13,860 per day on March 2 to $10,553 per day on March 9, 2018. The average Suezmax rates rose from $10,500 per day on March 2 to $11,707 per day on March 9, 2018.

Nordic American Tankers (NAT) only has Suezmax vessels in its fleet. For Teekay Tankers (TNK), 50% of its fleet is Suezmax vessels. For Tsakos Energy Navigation (TNP), 43% of its crude tanker fleet is Suezmax vessels.

Aframax rates

According to Weber’s weekly report, Aframax rates corrected from the recent highs in week 10. Availability levels loosened as weather-related delays eased. The rates on the Caribbean route dropped from $11,881 per day on March 2 to $5,209 per day on March 9. The average Aframax rates dropped from $12,929 per day on March 2 to $9,907 per day on March 9.

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