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Several tankers heading for destinations across Europe have been
facing huge delays due to high congestion during the last couple of
weeks, with most of them carrying jet fuel and gasoline. Interest
for clean floating storage has been increasing since mid-March,
exactly as it happened with crude oil since late February. Many
tankers haven't been able to discharge their cargoes as
demand/consumption has been heavily affected by most countries
remaining under general lockdowns.
Onshore storage capacity is almost fully occupied driven by the
collapse in demand with the crisis expected to last at least for
another month. More and more laden tankers currently positioned
close to European coasts can't discharge according to original
schedules. Amsterdam-Rotterdam-Antwerp (ARA) and hubs across the
Mediterranean remain the busiest regions, as cargo owners face
severe difficulties in finding buyers or storage tanks. This
situation is expected to last for weeks, as the market cannot
absorb volumes that typically get sent to the continent. This
drives a shortage in available units for future loadings as well,
pushing spot rates to new high records. There are severe and long
delays on the horizon for most tanker terminals in the ARA area.
Congestion will remain high.
Meanwhile, cargo flows on barges through rivers in central
Europe have also been affected by low water levels in the Rhine
which keeps on adding pressure. Major companies like BP have been
fixing for storage of clean cargoes or still looking to fix more
units.
Clean tanker fleet (including MR, LR1 and LR2) currently
positioned in North Western Europe and Mediterranean
The spread of laden vs ballast clean tankers (MR, LR1 and LR2)
in North Western Europe and Mediterranean suggests that employment
has been quite strong lately. Meanwhile, average speed for both
ballast and laden units has been increasing as well, excluding any
ships moving with less than eight knots.
Spread between laden and ballast clean tankers in North
Western Europe and Mediterranean and congestion
analysis
Most recent data by IHS Markit Commodities at Sea on
congestion suggest numbers of anchored clean ships in the region
have reached a new record high.
Moving to tankers carrying Dirty Petroleum Products in the
region, the interest for open Aframaxes to load fuel oil from North
Western Europe has been increasing this week, shaping the
availability of tonnage in the region, with rates pushed even
higher since Thursday. But rates in the Mediterranean/Black Sea
remain steady, as charterers have more options with plentiful
units. There has been some activity for intra-continental movements
as well, with Total having booked for loading in late April.
Rotterdam traffic hasn't been that strong, primarily due to the
COVID-19 pandemic still disrupting trade. The fall in fuel oil
trade (HSFO) between Russia and Singapore has been sharp so far in
the last month, with many cargoes now skipping ARA and moving
directly to the US Gulf instead. The US is now considered the major
importer of European and Russian fuel oil that's not complying with
IMO 2020, as US refiners import heavy products instead of heavy
crudes from Venezuela.
Posted 22 April 2020 by Fotios Katsoulas, Liquid Bulk Principal Analyst, Maritime & Trade, IHS Markit
