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Tanker Market

68

OPEC Monthly Oil Market Report – June 2016

Table 7.2: Spot tanker crude freight rates, Worldscale

Aframax

In May, Aframax was the only vessel size in the dirty tanker segment, which showed

enhanced rates, on average, from a month before. Aframax freight rates increased by

6%, as a result of mixed performance for the class, supported by increased rates for

tankers trading in both directions of the Mediterranean.

The markets in the North Sea and Mediterranean were balanced at the beginning of

the month before some replacement deals were fixed at high premiums. A lighter

tonnage list in the Mediterranean, combined with a sudden shortage of vessels, pushed

rates up in that region. Freight rates for tankers operating on the Mediterranean-to-

Mediterranean and Mediterranean-to-NWE routes edged up by 25% and 34% to

average WS116 and WS109 points, respectively, making Suezmax a viable alternative

to Aframax at a certain point, due to its falling rates and weak market.

Spot freight rates went down on the Caribbean-to-US East Coast (USEC) route by 4%

from the previous month, despite owners’ consistent resistance to lower rates, as

tonnage supply outweighed chartering requirements.

Aframax freight rates to eastern destinations were not an exception, dropping by 18%

for tankers trading on the Indonesia-to-East route to average WS91 points.

Clean spot freight rates

Clean tanker market sentiment was weak in May. On average, clean spot tanker freight

rates dropped by 11% from the month before to stand at WS125 points.

In the West of Suez, freight rates experienced a large drop on average. Tonnage in the

West was affected by the holidays and slow movement in the market. Among the main

drivers behind freight rate drops in the West was lower freight rates in the

Mediterranean, where they dropped by 23% and 22%, respectively, on the

Mediterranean-to-Mediterranean and Mediterranean-to-NWE routes. Nevertheless,

rates for medium-range tankers operating on the NWE-to-US East Coast went up by

7% to average WS119 points as the market was balanced, showing a multi-month

high, though the increase remained limited.

Size

Change

1,000 DWT

Mar 16 Apr 16 May 16 May 16/Apr 16

Crude

Middle East/East

230-280

73

65

63

-2

Middle East/West

270-285

41

43

38

-5

West Africa/East

260

72

67

62

-6

West Africa/US Gulf Coast

130-135

70

79

63

-17

Northwest Europe/US Gulf Coast

130-135

63

69

63

-6

Indonesia/East

80-85

147

111

91

-20

Caribbean/US East Coast

80-85

115

109

104

-5

Mediterranean/Mediterranean

80-85

106

87

109

22

Mediterranean/Northwest Europe

80-85

98

80

108

28

Sources: Argus Media and OPEC Secretariat.