More demand for LR2s

Demand for LR2 tankers will rise by 13% in 2014, McQuilling Partners says.

This expansion will be at expense of the LR1 sector, which could see a growth of just 1.2%, the US shipbroking firm said in its mid-year Tanker Market Outlook Update.

As a result, competition for market share between LR1 and LR2 will ensue while the freight effect is expected to be positive and higher than the broker’s previous projections, the report said.

At the same time, demand in the MR1 and MR2 sector is declining as more volumes traditionally reserved for MR tonnage are carried on LR tonnage.

McQuilling Partners suggests that demand in the crude and residuals transport sector will remain soft for the second half of 2014, finishing 1.7% below ton-mile totals of 2013.