Tanker Markets Still Looking for Sustainable Recovery
The tanker market in April was still in backwards mode. In its latest monthly report, OPEC said that dirty tanker rates declined in April, as the improvement seen in March in the Suezmax and Aframax classes proved temporary and VLCCs rates moved sideways. Rates fell as gains in the Atlantic Basin triggered by the fallout from the February big freeze in the US Gulf Coast (USGC) unwound. Clean rates rose across the board, except on the NWE-to-US East Coast (USEC) route, where rates fell back from the relatively strong levels seen in the prior two months. Dirty tanker rates are not expected to pick up until 2H21 or 2022, with the latter date more likely. The outlook for clean rates, however, is slightly more positive.
Tankers Picked Up the Pace During March
The tanker market edged higher during the final month of the first quarter of 2021. According to the latest monthly report from OPEC, dirty tanker rates picked up in March, as gains in Suezmax and Aframax rates outpaced a further slight decline in VLCCs. Increases in the these vessel classes were driven by tighter tanker supply as the blockage of the Suez Canal kept ships waiting on both sides of the waterway amid uncertainties regarding when the disruption would be resolved. After the container ship ‘Ever Given’ was dislodged at the end of the month, rates fell back toward levels seen at the start of the year. The upcoming 2Q seasonal refinery maintenance in Asia also reduced support by the end of the month. Clean tanker rates in March saw an improved performance East of Suez, while West of Suez routes around the Med eased from the higher levels seen last month.
The tanker market posted a mild rebound during the month of December. According to the latest monthly report from OPEC, dirty tanker rates experienced a slight improvement m-o-m in December, while still remaining near multiyear lows amid a persistent imbalance in tanker demand and availability. VLCC and Suezmax rates saw some improvement on eastward rates .
Tanker Market Weak Throughout November
The tanker market stayed weak during the month of November, OPEC said in its latest monthly report. Dirty tanker rates remained weak in November, at the historically low levels so far in 2H20, amid ample tonnage lists. However, signs indicating that November could be the bottom of the market have provided some hope for ship owners as they look to 2021. Clean tanker rates picked up from multi-year lows, supported by improving West of Suez activities.
Spot fixtures
Global spot fixtures rose m-o-m in November, after dipping lower the month before, increasing 0.22 mb/d, or 1.5%, to average 15.09 mb/d. The increase came as Chinese refiners returned to the market after a pause due to the Golden Week holiday and as independent refiners received another round of import quotas. Spot fixtures were still 4.9 mb/d, or almost 25%, lower than the same month last year, reflecting the overall muted environment due to the COVID-19 pandemic.