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In 2019 to date, suezmax vessels have proved rather sensitive to
market volatility. In the European market, rates to move cargo from
the Black Sea to the Mediterranean have declined during the last
couple of weeks, currently standing close to USD 10,000 per day.
Charterers have gradually pushed the market down and in-turn gained
the upper hand on owners. But the situation seems to be different
in West Africa, however without any miracles to report.
Fundamentals have been affected by the performance of VLCCs
exposed in the region, with the overall sentiment and rates
recently beginning to improve as owners reposition their ballasters
according to news and expectations, as we approach autumn. The last
part of the summer has usually been firmer than early summer
months, providing more space for optimism to develop. Activity
remains low but not disappointing for now, as the recovery of VLCCs
usually drives an improvement for suezmaxes as well. Without doubt,
dynamics are not the same, but as there are still simply too many
units within this size segment out there, demand is not expected to
change dramatically.
Charterers have been fixing last cargoes for the end of August
and early September, with Repsol having recently booked a couple of
ships for loadings from West Africa to Spain and from Sidi Kerir to
Spain. Activity in Europe has been limited overall.
As data by IHS Markit Commodities at Sea
shows, demand hasn't changed much lately for suezmaxes, with the
segment having carried around 225 million barrels of crude oil
since late April. Any spikes or falls do not last for long, with
the market balancing quickly due to the plethora of open vessels
made available.
Posted 19 August 2019 by Fotios Katsoulas, Liquid Bulk Principal Analyst, Maritime & Trade, IHS Markit
