VLCC tonnage pushing rates downward

Spot market TCEs for large tankers slump by 23% since this time last week as sentiment sags.

The VLCC spot market is sliding as vessel supply outstrips cargo offering, brokers said.

The average time-charter equivalent (TCE) rate for the sector fell by 5.6% today alone, bringing the Baltic Exchange estimate to $25,400 per day.

The assessment is down 23% from this time last week, when VLCCs were earning nearly $33,000 per day on average.

Fearnleys said today that despite a perception that chartering activity is low, volumes are normal.

“The oversupply of tonnage is weighing heavy on sentiments and rates have correctly sharply for all major VLCC routes,” said the Norwegian shipbrokerage in a weekly report.

Wednesday's fixture activity saw the Day Harvest-operated, 299,000-dwt CosGrace Lake (built 2006) pick up a fixture from Koch for a ride from the Middle East to China.

The ship will earn WorldScale (WS) 49, down from WS 49.5 on the same route yesterday, according to Tankers International.