West Africa-Far East VLCC rates at 6-week high on more bullish sentiment: sources

VLCC rates on the West Africa-Far East route, basis 260,000 mt, rose Worldscale 1 to be assessed at w41 Wednesday, with shipping sources attributing the rising rates to sentiment rather than underlying fundamentals.

The w41 assessment equates to $16.57/mt, the highest since an identical $16.57/mt assessment on April 30. Rates rose after brokers reported Unipec put the Boston VLCC on subjects for a WAF-China voyage at w41 loading July 11.

“The WAF rates are moving up in reaction to the Persian Gulf rates which increased on Monday. Ninety percent of the reason for this spike in VLCC rates is due to sentiment I feel, there are no fundamentals to support it,” said a shipbroker.

“We are still seeing very low volumes [cargoes] from the Persian Gulf and there are still abundant ships around.”

A second broker said that there was easily enough tonnage in the Persian Gulf and West Africa to handle the cargoes entering the market in the coming weeks.
Source: Platts