Middle East VLCCs continue sharp plunge

As charterers fix VLCC cargoes further afield, TD3 route drops by 15.6% in one day.

Crude tanker routes

Here are the key trade lanes tracked in the dirty tanker sector.


VLCC rates in the Middle East moved sharply downward Monday, as a string of new fixtures was still insufficient to stem the decline from December heights.

The Baltic Exchange’s assessment of the benchmark TD3 route between the Middle East and Japan plunged today by $12,700, or 15.6%, to reach a time-charter equivalent (TCE) rate of $69,000 per day.

That marks a 32.5% decline since this time last week, when TCE rates stood at more $102,000 per day. And it is 16% lower than the $82,200 per day earned a year ago.

Today saw the WorldScale (WS) rate on the TD3 fall by 12.2 points to WS 82, according to the Baltic Exchange.

Signs of deeper dip

But data from Connecticut broker Charles Weber show a deeper slump, with the TD3 at WS 77.5 today, compared to WS 87.5 yesterday.

The day’s chartering activity saw Shell Trading and Supply grab two VLCCs operated by SK Energy earn WS 57.5 for a ride from the Middle East to Singapore, according to the Tankers International (TI) smartphone app.

However, Singapore Petroleum Company fixed DHT Holdings' 299,000-dwt DHT Falcon (built 2006) for WS 64 on the same route.

WS 65 last week

Last done on the route was WS 65 on Friday.

Elsewhere, Trafigura booked Athenian Sea Carriers’ 317,000-dwt Athenian Harmony (built 2010) for lumpsum $6.25m for a ride from the North Sea to Singapore.

Last done on the infrequently plied route was $5.5m in November.