World News
VLCC Market Still Struggling as Tanker Earnings Pushed Further Down
Weak demand in the tanker market, particularly for larger vessels, combined with high bunker prices pushed down tanker earnings even further in February, according to the latest Tanker Insight report from Drewry Maritime Research (Drewry).
Drewry's Tanker Earnings Index fell 52 percent, and its index for dirty tankers fell even faster at 66 percent, as some operators faced negative earnings.
VLCC rates between the Middle East and Far East fell 10 points to WS33, while Suezmax rates on the West Africa-US Gulf route declined by 12 percent, leading to a sharp dip in earnings because of rising bunker costs, it said.
The shale oil boom in the U.S. was also said to have reduced domestic import demand for sweet crudes from Africa, in turn depressing Suezmax transatlantic trade.
Going forward, Drewry said demand for very large crude carriers (VLCCs) will be driven mainly by imports from the Far East in the near term, and increased demand for light sweet crude in China could support growing chartering activity in West Africa.
Katharina Stanzel, managing director of the trade group INTERTANKO, recently said that tanker owners have lost billions of dollars since 2009 and negative earnings are common on many routes.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 502.00 | 7.00 | 617.00 | 6.00 |
| Rotterdam | 455.00 | 8.00 | 619.50 | 4.00 |
| Houston | 467.00 | 4.50 | 625.00 | 2.50 |
| Fujairah | 495.00 | 6.00 | 712.50 | 1.50 |
| Global 20 Ports Average | 524.50 | 4.50 | 710.50 | 4.00 |
| Global 4 Ports Average | 479.50 | 6.50 | 643.50 | 3.50 |
| Global Average Bunker Price | 570.50 | 2.00 | 747.50 | 5.50 |
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