19-09-2017

Tankers: Asia Aframax rates at four-month high on increase in trading volumes

The Aframax market in Asia rose to the key Worldscale w100 level for the first time in four months Friday on an increase in trading volumes, sources said.

The Indonesia-Japan Aframax rate was last assessed at w100 on May 15, S&P Global Platts data showed.

"The last time we fixed w100 bunkers were at $295/mt, now it is about $45/mt more, which means some $50,000 more cost for an owner on a round trip Indonesia-Geelong voyage, so rates have to go up," an Aframax shipowner said.

Market sources said that in addition to two outstanding Indonesia-Australia type requirements from Ampol and Shell, other long-haul cargoes for Indonesia-North Asia were heard for Citus, ST Shipping and Shell.

After a few months of depressed activity levels, the market out of the Indonesia region, which includes Singapore, has seen an increase in the volumes of fuel oil and crude oil cargoes.

Freight levels shot up with Vitol said to have placed on subjects the Peak Spirit for a Kimanis-Geelong voyage, loading September 22, at w109.5 for heat, a source said.

Market sources said the no heat rate for the fixture was w107 basis 80,000 mt, and uncovered cargoes for similar voyages was expected to pay higher levels.

"There is still a lot of uncertainty in ships' schedules for Singapore and there is still bad weather in central China delaying ships," said an Aframax shipowner.

Typhoon Talim, which has delayed vessels in the South China Sea for at least three days, was heading to Japan, market sources said.

The jump in rates was also being attributed to the market witnessing several replacement fixtures.

"Ships are also dropping left, right, center because they are getting replaced or weather is getting better. I do not think rates would fly unless there are more typhoons, but sentiment is strong today because Vitol had to cover their cargo," said a charterer.

Vitol was said to be seeking a vessel for its September 22 loading Kimanis-Geelong cargo from Monday.

Platts assessed the key Aframax Indonesia-Japan voyage up w6.5 at w100 basis 80,000 mt, Friday.

Source: Platts 

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