Image courtesy Frontline
SINGAPORE (Dow Jones)–Asia’s crude tanker market may stay depressed by heavy supply as September booking begins, but healthy demand is still supporting vessels carrying clean petroleum products.
The rate for a 260,000-metric-ton Very Large Crude Carrier from the Middle East to Japan was last assessed Tuesday at Worldscale 45.31, its lowest in six-and-a-half months, the Baltic Exchange said. The cash earning for owners was minus $801 a day, down from minus $110 a week ago.
Supply-demand fundamentals will likely stay weak in the coming weeks, with refineries in several East Asian countries cutting back output on soft diesel demand or maintenance, shipbrokers said.
Around 102 cargoes have been fixed to be lifted in August, possibly failing to post a year-on-year gain for the first time in 2011, data from Meiwa International showed.
“I think some cargoes are not yet covered, so for August the total count will end at around 110 fixtures,” a Japanese broker said.
“But there are just too many ships in the Middle East, so the terrible market situations will continue when September booking start [in the coming week].”
The rate for a VLCC from West Africa to China again hit a year’s low of W43.86 Tuesday, indicating thin demand from the world’s second-largest oil consumer.
However, the 80,000-ton Aframax rate from Southeast Asia to the east coast of Australia rose to W96.28 from W91.17, as booking activity picked up for end-August loading cargoes.
For vessels carrying clean petroleum products, the availability of long-range vessels in the Middle East and West India has decreased on healthy demand for light and middle distillates, pushing up freight rates.
The rate for a 55,000-ton LR-1 cargo from the Middle East to Japan jumped 6.77 on week to W137.42, its highest since end-May, while the rate for a 75,000-ton LR-2 cargo for the same route inched up to W125.59 from W125.58.
The rate for a 30,000-ton tanker from Singapore to Japan was up 0.35 at W159.14.
-By Max Lin, Dow Jones Newswires
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