In International Shipping News 28/07/2016
Source: Platts
It was a case of too many tankers and not enough work Tuesday, as VLCC rates in the Americas fell to their lowest levels since S&P Global Platts began assessing those routes in 2013.
The Caribbean-Singapore route was assessed at a lump sum of $3.1 million, or $11.48/mt, down $300,000 on the day.
The previous low for that journey came on July 14, when it finished at $3.3 million, or $12.22/mt.
Tonnage in the region is thick for the foreseeable future. There are nine VLCCs due to open in the Caribbean or Gulf of Mexico through the end of August, with five more projected to be naturally positioned over that period.
At the same time, inquiry has been scant for some time, making shipowners antsy when any cargoes appeared.
Market sources said that was the case when PetroChina brought a Caribbean-Singapore cargo onto the market.
“There has been a general lack of inquiry and PetroChina was the only one in the game,” a shipbroker said.
Shipowners were heard to be offering $3.85 million, but a ship from outside the region was fixed instead.
The VK Eddie was reserved at $3.1 million, but it will have to ballast in from the southern coast of England to load the cargo.
According to Platts cFlow trade-flow software, the ship had been sitting off Fawley since July 18. The shipbroker said she had been put on subjects twice for a North Sea cargo, but failed both times.
“They really wanted to get that ship moving,” he said.
Though the $3.1 million mark is the lowest the Caribbean-Singapore route has seen since November 4, 2013, sources have said freight rate have been lower.
In recent memory, for example, the route was assessed as low as $2.6 million in 2009.
Though no market participants saw that scene being repeated any time soon, the shipbroker said further softening could be seen.
“It’s going to be interesting to see what happens,” he said. “We are not expecting to see many cargoes coming out outside of a couple for PetroChina, so it could be a PetroChina game for awhile.
“The position list is growing and sentiment seems pretty soft right now,” he said.
Source: Platts
