SINGAPORE: Rates for crude tankers on key Asian freight routes are expected to increase this week on strong Chinese demand and rising bunker prices, shipbrokers said on Tuesday.
For products, rates are likely to remain under pressure due to stagnant demand and ample tonnage.
CRUDE
The world's benchmark Very Large Crude Carrier (VLCC) export route from the Middle East Gulf to Japan rose to W53.59 or $15,198 a day on Monday, from W45.90 or $7,296 a day last week, on strong demand from China and India.
"The market is very busy as many eastern charterers pile into the market after the holidays," said broker firm ICAP.
"Owner ideas are now firmer as they become a little more picky on which cargoes to decide to offer."
China booked three VLCCs from the Middle East and one from West Africa on Monday, while India chartered two from the Middle East, shipbrokers said.
Baltic Exchange rates for 260,000-tonne crude tankers from West Africa to China surged to a 2011 high of W52.47 on Monday from W49.77 last week.
"Little change is expected in the West Africa market in the near term as a steady stream of ballasts continue to offer sufficient supply," said broker firm Charles R. Weber.
A total of 78 VLCCs have been booked to Asia from the Middle East for February, one more than in January during the same time period, according to Meiwa International.
Total eastbound fixtures in January totaled 95 VLCCs, the highest since July 2010.
Traders were continuing to closely monitor the unrest in Egypt, which has slowed port operations for some container ships.
Tankers, however, have been travelling through the Suez Canal, the main passageway for Europe's crude oil and imported goods, as usual with no reports of delays or cancellations.
Rates for 80,000-tonne Aframax tankers from Southeast Asia to East Coast Australia rebounded to a near one-month high of W88.75 from W84.17 last week.
Rising bunker prices have also supported freight rates as shipowners look to cover the additional operating costs.
The Asian fuel oil market has surged to year-high levels over the past month due to tightening supplies.
PRODUCTS
For products, medium range (MR) tankers travelling from Singapore to Japan, rates tumbled to a one-month low of W138.14 from W140.57 last week.
"The anticipated pre-Chinese New Year rush did not occur, and it is unlikely this week's activity will be much different than at present," said broker firm BRS.
Baltic Exchange rates for South Korea to North America's West Coast eased to a two-month low of $28.02 a tonne from $28.29 last week.
Rates for clean tankers travelling from South Korea to Singapore fell to $9.02 a tonne from $9.11 last week.
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