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Rising WAF-Europe Suezmax rates could lead to co-loadings on VLCCs: sources
The increasing difference between freight rates on West Africa to Europe routes on Suezmaxes and VLCCs could again lead charterers to co-load Suezmax cargoes on VLCCs, according to shipping sources.
Suezmax freight rates on the WAF-UK Continent and WAF-Mediterranean routes, basis 130,000 mt, have been firming this week as a rise in fixtures has caused a sharp tightening of the position list.
Suezmax rates on both routes were assessed at Worldscale 60 Wednesday, equating to $11.86/mt on the WAF-UKC route and to $12.45/mt on the WAF-Mediterranean route.
At the same time, VLCC rates on the routes were assessed w13 lower than Suezmax at w47, which equates to $9.29/mt for WAF-UKC and $9.75/mt for WAF-Mediterranean.
Sources said that if Suezmax rates continue to rise without an accompanying increase in VLCC rates, Suezmax cargoes could be co-loaded on VLCCs as happened in January.
"It is always an option to go on VLCCs when the Suezmax rates go up," said a shipbroker.
"We've been having internal discussions about this." said a shipowner, "With Suezmaxes becoming more expensive, VLCCs could become competitive for WAF-Europe. They could start to come into play if there's a w15 point differential between WAF-Europe Suezmax and VLCC rates."
Source: Platts
Suezmax freight rates on the WAF-UK Continent and WAF-Mediterranean routes, basis 130,000 mt, have been firming this week as a rise in fixtures has caused a sharp tightening of the position list.
Suezmax rates on both routes were assessed at Worldscale 60 Wednesday, equating to $11.86/mt on the WAF-UKC route and to $12.45/mt on the WAF-Mediterranean route.
At the same time, VLCC rates on the routes were assessed w13 lower than Suezmax at w47, which equates to $9.29/mt for WAF-UKC and $9.75/mt for WAF-Mediterranean.
Sources said that if Suezmax rates continue to rise without an accompanying increase in VLCC rates, Suezmax cargoes could be co-loaded on VLCCs as happened in January.
"It is always an option to go on VLCCs when the Suezmax rates go up," said a shipbroker.
"We've been having internal discussions about this." said a shipowner, "With Suezmaxes becoming more expensive, VLCCs could become competitive for WAF-Europe. They could start to come into play if there's a w15 point differential between WAF-Europe Suezmax and VLCC rates."
Source: Platts
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