Crude flat prices gained from last week, buoyed by the continued shutdown of the Forties crude oil pipeline as well as diminishing US crude stockpiles. EIA data indicated that US crude inventories declined for the fifth consecutive week, down by 6.5 mmb for the week ending Dec 15. ICE Brent front-month futures jumped by $1.59/bbl on the week while Dubai swaps rose by $0.82/bbl w-o-w.
The East of Suez VLCC market saw an influx of activity on the release of January AG stems. As such, rates for the benchmark AG/Japan route rose by w5 points from last week. Further gains were limited by a lengthy position list that rolled over from December.
In comparison, the WAF VLCC market was fairly muted with rates for the key WAF/Far East route down by w0.5 points on the week. The spike in the Brent-Dubai EFS spread has weighed on demand for WAF crude, with some Angolan and Nigerian cargoes left unsold from the January program as reported by Reuters.
The Asian Suezmax market held steady over the week as fresh cargo demand from the release of January stems was balanced by ample tonnage in the region. Suezmax rates for the key AG/East route were flat w-o-w at w87.5. Likewise, Suezmaxes trading in the WAF saw TD20 move sideways at w87.5 over the week as activity remained subdued.
Sentiment in the Asian Aframax market was fairly stable as rates for an AG/East trip held steady at w112.5 from last week. In the AG segment, a lack of ballasters from the East over the past couple weeks has kept the supply of modern vessels tight. Rates for an Indo/Japan trip edged up by w2.5 points w-o-w as the influx of cargoes were covered under the radar and ships disappeared from the position list without much details.
Asian LR rates came under downwards pressure this week as TC1 and TC5 dropped by w10 and w12 points respectively. While muted activity at the start of the week weighed on LR2 rates, a pick-up in cargo demand towards the end of the week is likely to prevent further decline in rates. The LR1 segment saw a lack of fresh activity amidst ample vessel supply. At least 15 LR1s are available for loading in the AG over the next week.
Asian MR rates continued to ease as sluggish activity led to a build-up of tonnage in all key areas. Rates for the key AG/Japan route inched down by w1.5 points from the week before while rates for a South Korea/Singapore run basis 40 kt fell by $70,000 w-o-w.