According to the latest monthly report from OPEC, after several months of bearish momentum, spot freight rates recovered in December across all tanker sectors. December was the only month exhibiting positive performance on all reported routes and in various tanker segments. Dirty tanker spot freight rates registered high gains, particularly for Suezmax and Aframax tankers, while VLCC gains remained limited. On average, VLCC spot freight rates increased by 4.5%, while spot freight rates for both Suezmax and Aframax were up by a remarkable 73% and 45%, respectively, compared with the previous month. The clean market showed higher monthly freight rates on all reported routes, but remained below those registered a year ago.
Spot fixtures
In December, OPEC spot fixtures increased by 9% from the previous month to average13.16 mb/d, according to preliminary data. The increase came on the back of higher spot fixtures from the Middle East-to-East and Middle East-to-West destinations, which increased by 0.5 and 0.47 mb/d respectively in December to average 6.42 mb/d and 2.79 mb/d. Winter season demand supported the fixture increase in December. Spot fixtures from outside the Middle East registered a smaller gain of 0.18 mb/d or 4% in December compared with last month.
Sailings and arrivals
OPEC sailings increased by 0.57 mb/d or 2% in December to stand at 24.08 mb/d, supported by an increase in Middle East sailings. In December, Middle East sailings gained 0.43 mb/d or 4% from the previous month to stand at 17.63 mb/d. Crude oil arrivals increased in December in Europe, the Far East and West Asia by 0.2%, 0.5% and 4.5%, respectively, compared with the previous month, while North America arrivals declined by 10.2%.
Spot freight rates
VLCC
For the very large crude carrier (VLCC) sector, spot freight rates for tankers operating on the Middle East-to-East and West Africa-to-East routes registered the largest increase among all reported routes. Middle East-to-East VLCC spot freight rates increased by 3WS or 5% in December, while the West Africa-to-East route showed similar gains, compared with the previous month. The increase in both routes was supported mainly by requirements from Asia. VLCC spot freights on the long-haul route from the Middle East-to-West also increased in December to average 39WS, up by 3% from the previous month. As was the case one month earlier, increased freight rates were mainly driven by seasonal demand. In December, the VLCC class registered its lowest gains in comparison with other dirty tanker segments. The tonnage list was often balanced and vessel availability was sufficient, despite some occasional delays in the East.
Suezmax
In December, Suezmax spot freight rates registered a remarkable increase, on average edging up by 73% compared with one month earlier. Long-awaited gains have been detected on all reported routes. The West African Suezmax market remains active as seen last month, while tonnage availability thinned, particularly for certain dates. As a result, spot freight rates for tankers operating on the West Africa-to-US route increased by WS 39 points in December to average WS 94 points. On the Northwest Europe-to-US route, Suezmax spot freight rates increased by 74% compared with a month earlier, to average WS 89 points. Additionally, higher Suezmax spot freight rates have been reported in several regions, including the Caribbean, the Mediterranean and the Black Sea. This has been driven by tight availability, steady demand, and some prompt replacements, as well as delays at the Turkish straits, thus increasing the total transit period from the Black Sea to the Mediterranean, providing further support to freight rates.
Aframax
Aframax spot freight rates were no exception in December, experiencing large increases during the month, as seen in other dirty tankers. The Caribbean Aframax market was active as the pre-holiday rush materialized, and ship owners pushed for higher freight rates, in part because Suezmax freight rates increased. As a result, US–Caribbean spot freight rates gained 43% in December to average WS146+ points, also supported by delays and a thinning tonnage list.
The North Sea and the Baltic reflected higher freight rates mainly due to bad weather in the region, which caused loading delays and created the need for prompt replacements in an already tight market. Freight rates in the Mediterranean and the Black Sea also increased, following the rise seen in the North Sea. Tankers operating the Mediterranean-to-Mediterranean and Mediterranean-to-Northwest Europe routes saw a worthy increase in spot freight rates during December, with increases of 49% and 59%, respectively, compared with the previous month. Aframax freight rates in the East reported an increase as well, with spot freight rates for tankers operating on the Indonesia-to-East route showing an increase of 33% from the previous month to average WS 109 points.
Spot fixtures
In December, OPEC spot fixtures increased by 9% from the previous month to average13.16 mb/d, according to preliminary data. The increase came on the back of higher spot fixtures from the Middle East-to-East and Middle East-to-West destinations, which increased by 0.5 and 0.47 mb/d respectively in December to average 6.42 mb/d and 2.79 mb/d. Winter season demand supported the fixture increase in December. Spot fixtures from outside the Middle East registered a smaller gain of 0.18 mb/d or 4% in December compared with last month.
Sailings and arrivals
OPEC sailings increased by 0.57 mb/d or 2% in December to stand at 24.08 mb/d, supported by an increase in Middle East sailings. In December, Middle East sailings gained 0.43 mb/d or 4% from the previous month to stand at 17.63 mb/d. Crude oil arrivals increased in December in Europe, the Far East and West Asia by 0.2%, 0.5% and 4.5%, respectively, compared with the previous month, while North America arrivals declined by 10.2%.
Spot freight rates
VLCC
For the very large crude carrier (VLCC) sector, spot freight rates for tankers operating on the Middle East-to-East and West Africa-to-East routes registered the largest increase among all reported routes. Middle East-to-East VLCC spot freight rates increased by 3WS or 5% in December, while the West Africa-to-East route showed similar gains, compared with the previous month. The increase in both routes was supported mainly by requirements from Asia. VLCC spot freights on the long-haul route from the Middle East-to-West also increased in December to average 39WS, up by 3% from the previous month. As was the case one month earlier, increased freight rates were mainly driven by seasonal demand. In December, the VLCC class registered its lowest gains in comparison with other dirty tanker segments. The tonnage list was often balanced and vessel availability was sufficient, despite some occasional delays in the East.
Suezmax
In December, Suezmax spot freight rates registered a remarkable increase, on average edging up by 73% compared with one month earlier. Long-awaited gains have been detected on all reported routes. The West African Suezmax market remains active as seen last month, while tonnage availability thinned, particularly for certain dates. As a result, spot freight rates for tankers operating on the West Africa-to-US route increased by WS 39 points in December to average WS 94 points. On the Northwest Europe-to-US route, Suezmax spot freight rates increased by 74% compared with a month earlier, to average WS 89 points. Additionally, higher Suezmax spot freight rates have been reported in several regions, including the Caribbean, the Mediterranean and the Black Sea. This has been driven by tight availability, steady demand, and some prompt replacements, as well as delays at the Turkish straits, thus increasing the total transit period from the Black Sea to the Mediterranean, providing further support to freight rates.
Aframax
Aframax spot freight rates were no exception in December, experiencing large increases during the month, as seen in other dirty tankers. The Caribbean Aframax market was active as the pre-holiday rush materialized, and ship owners pushed for higher freight rates, in part because Suezmax freight rates increased. As a result, US–Caribbean spot freight rates gained 43% in December to average WS146+ points, also supported by delays and a thinning tonnage list.
The North Sea and the Baltic reflected higher freight rates mainly due to bad weather in the region, which caused loading delays and created the need for prompt replacements in an already tight market. Freight rates in the Mediterranean and the Black Sea also increased, following the rise seen in the North Sea. Tankers operating the Mediterranean-to-Mediterranean and Mediterranean-to-Northwest Europe routes saw a worthy increase in spot freight rates during December, with increases of 49% and 59%, respectively, compared with the previous month. Aframax freight rates in the East reported an increase as well, with spot freight rates for tankers operating on the Indonesia-to-East route showing an increase of 33% from the previous month to average WS 109 points.