A sizable gap has persisted between LR2s and LR1s carrying cargoes from the Middle East to the Far East, but the mismatch is not expected to last for much longer.

With an LR2 sailing from the Middle East to Japan earning time charter equivalent (TCE rates) of $27,876 per day and LR1s on the same route earning $35,733 per day, Howe Robinson said it was $200,000 cheaper to fix one of the larger product tankers.

“Good activity so far this week counting 12 ships subs/concluded, subsequently the tonnage list has shortened, and we now count 20 vessels under 15 years in the next 20 days, which is by no means oversupplied,” the broker said of the Middle East-Japan LR1 trade in its daily note published on Wednesday.