Asian VLCC spot fixtures in Nov hit 2012 high of 144 on winter demand
By Pradeep Rajan in Singapore
November 20, 2012 - A record number of spot fixtures out of the Persian Gulf caused by
winter demand have helped push the Asian VLCC rate for hauling crude into
North Asia to the 50 Worldscale mark for first time since May. (See related chart: Chinese spot VLCC vs. Persian Gulf spot VLCC cargoes).
According to shipbrokers, the VLCC spot fixtures done from the Middle
East has hit a 2012 high of 144 for November.
The previous monthly high for
spot VLCC fixtures this year was 136 in January and April, according to a
Singapore-based broking house.
Market watchers said the spot fixing volume registered for the November
loading dates could be the highest in the last few years, although this
couldn't be verified as no loading data prior to 2010 was readily available.
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The spike in the number of fixtures has also driven up the rate for
hiring a VLCC to the Persian Gulf to East voyage to the key w50 mark after
almost five months.
The last time the freight level was in the half century
mark was on May 30 at w52.
"The market is very strong since the last few weeks. The chartering
demand has picked up and the tonnage is getting very tight," a chartering
source with a North Asia-based refiner said.
"This is the highest ever fixing volume I have seen since I came into
chartering some few years ago."
A break-down of the November fixtures show that out of the 144 deals, 38
cargoes were done on the Persian Gulf-China route, while Persian Gulf-West
saw 22 fixtures and the Persian Gulf to the East, which would include cargoes
going to countries such as Taiwan, South Korea, Japan, India, Singapore and
Thailand, had 84 deals.
For the October loading dates, out of the 129 fixtures, there were 66 on
the Persian Gulf to East routes.
Sources said the increase in the Persian
Gulf-East fixtures for November loading was due to countries such as South
Korea, Taiwan and Japan loading extra crude for winter demand.
"The refining margins for September and October were almost the same.
Actually it is getting worse. But winter demand is pulling in more crude
into the Far East. Also South Korean refiners have expanded their facilities
a lot," the chartering source said.
Next page: December tightening