Activity in the VLCC spot markets might have picked up, but charterers are still drip-feeding their programmes to owners, players tell Tankerworld. "There seems to be enough available tonnage for refiners not to be rushing to complete their November requirements,” a Singapore-based broker told Tankerworld. As a result, “rates remained under downward pressure and there is little to indicate any immediate improvement,” said Fearnleys on Thursday.
Tankerworld data shows average VLCC spot rates on all routes have stayed between WS 70 and WS 90 since falling below the WS 100 mark in the middle of October.
Brokers indicate that rates for voyages going East out of the Middle East Gulf are currently being fixed around WS 72, almost no change from the WS 70 achieved last week.
One report said that owners were 'frustrated' as charterers were withholding their enquiries even though there is a still a chunk of November loadings to complete.
Aside from strategic plays by charterers, other factors cited for low activity include weakening global oil demand and OPEC output cuts.
One broker told Tankerworld last week that VLCC spot markets were “currently dead, on the back of OPEC cuts and excess tonnage availability.”
Players however, also highlighted that plunging bunker prices have helped mitigate lower freight rate levels.
Owners have been quoted saying that TCE earnings at WS 72 are in fact same as when rates were around WS 90 a few months ago.
According to Bunkerworld data, the price of key grade 380 centistoke bunker fuel in Singapore, the world's largest bunkering port, was $247.50 per metric tonne (pmt) on Wednesday compared to $761.50 pmt on July 15.
Tankerworld data shows average VLCC spot rates on all routes have stayed between WS 70 and WS 90 since falling below the WS 100 mark in the middle of October.
Brokers indicate that rates for voyages going East out of the Middle East Gulf are currently being fixed around WS 72, almost no change from the WS 70 achieved last week.
One report said that owners were 'frustrated' as charterers were withholding their enquiries even though there is a still a chunk of November loadings to complete.
Aside from strategic plays by charterers, other factors cited for low activity include weakening global oil demand and OPEC output cuts.
One broker told Tankerworld last week that VLCC spot markets were “currently dead, on the back of OPEC cuts and excess tonnage availability.”
Players however, also highlighted that plunging bunker prices have helped mitigate lower freight rate levels.
Owners have been quoted saying that TCE earnings at WS 72 are in fact same as when rates were around WS 90 a few months ago.
According to Bunkerworld data, the price of key grade 380 centistoke bunker fuel in Singapore, the world's largest bunkering port, was $247.50 per metric tonne (pmt) on Wednesday compared to $761.50 pmt on July 15.