Suezmax spot freight rates declined by 32% in February, Aframax Rates Down 20%.
Suezmax spot freight rates declined 32% in February from the previous month on the two main routes. From West Africa to the US, spot freight rates declined by 33% backed by high stocks in the US, a decline of crude oil in floating storage and spill-over from the VLCC sector. However, y-o-y spot freight rates from West Africa to US Gulf exhibited an increase of 35%. On the route from North-West Europe to the US, Suezmax spot freight rates indicated a decline of 32% in February from the previous month. High stock levels in the US as well as the maintenance season were among the factors behind the decline. Additionally, weak Black Sea and Mediterranean activities halted any rise in the Suezmax spot freight rates from North-West Europe as Turkish Strait delays decreased by three days prompting tonnage availability. On an annual basis, Suezmax spot freight rates from North West Europe to US Gulf experienced a 42% increase in February.
The Aframax sector came under pressure in February. Average spot freight rates declined by 20%. Spot freight rates from the Caribbean to the US decreased by 19% in February from a month earlier. The holiday period in Latin America as well as high inventories in the US and discharges of oil from floating storage were the main factors limiting activities in that route. For the reported East of Suez route, Aframax spot freight rates dropped 19% in February on the back of market developments related to China New Year and maintenance period. Spot freight rate from Mediterranean to Mediterranean and from Mediterranean to North West Europe declined by 23% and 20% respectively on the back of shortened delays at the Turkish Straits, tonnage availability and the decrease of crude oil in floating storage.
The Clean Tanker Market
The clean tanker market came under pressure in February from the previous month on all reported routes. On average, clean tanker spot freight rates declined by 10% in February from a month earlier.
Limited activities were the main factor contributing to the decrease due to refinery maintenance as well as various participants remaining away from the market due to various holidays.
East of Suez clean spot freight rates declined by 12% on average in February from the previous month. The preparation for the coming maintenance season reduced activity. Tonnage availability also supported the decrease in spot freight rates in the East. However, on an annual basis, East of Suez clean spot freight rates indicated an increase of 15% in February.
Clean spot freight rates declined by 9% on average in the West of Suez in February from the previous month. Spot freight rates for voyages from the Caribbean to the US saw a decline of 7% compared to previous month as refinery maintenance started in the Caribbean. Trans-Atlantic spot freight rates declined by 12% in February compared to the previous month backed by closing arbitrage and discharge of petroleum products from floating storage. Mediterranean to Mediterranean and Mediterranean to Northwest
Europe spot freight rates declined in February, mainly due to the reduction of Turkish Straits delays and the drop of petroleum products in floating storage.