Clean NWE-USAC freight rates fall on weak US demand: sources

Spot freight rates to send a medium-range tanker from Northwest Europe and the Mediterranean to the US Atlantic Coast have fallen on weak cargo demand and growing available tonnage in Europe, sources said Wednesday.
Freight rates to send a 37,000 mt gasoline cargo on a typical Amsterdam-Rotterdam-Antwerp to New York Harbor route fell Worldscale 5 to w125 on Tuesday's Platts Market-On-Close -- or a fall of $0.86/mt to $21.53/mt -- as several days of weak activity on the route has led to an abundance of tonnage available for prompt loadings.
Sources continued to peg freight rates in the w125 region Wednesday morning, quoting a lack of export arbitrage opportunities for gasoline cargoes as partly to blame for the low activity levels.
"I would say it is still w125 for UKC-USAC, but the arbitrage [for gasoline] is still shut so there is very little going on," said a shipowner.
The European gasoline market has yet to benefit from a seasonal uptick in gasoline demand from the US.
"[The] driving season is not having an impact," a trading source said, referring to low demand from the US in European markets.
"The only real influence [from the US] currently is that it is weak, so it's always the driver of sorts, even if it means currently it's forcing its normal import tons elsewhere," a second European trading source said.
The unofficial start of the US driving season is the Memorial Day long weekend -- the last weekend of May this year -- but stocks in the US Atlantic Coast remain at the top of the five year average range.
The latest US Energy Information Administration weekly data report will be released today at 1430 GMT.
The June arbitrage swap -- the difference between the RBOB futures and the European Eurobob swaps market -- was trading at 8.90 cents/gal Wednesday morning, market sources said.
That was an increase from the beginning of the week when it reached a month low of 7.20 cent/gal, sources said, as the front month EBOB barge crack swap has softened $1.55/barrel on poor demand, heard trading at $11.20/b Wednesday, down from assessed $11.50/b Tuesday, Platts data showed.
Source: Platts