According to preliminary data, global spot fixtures increased in March by 6.5% to
average 17.89 mb/d. OPEC spot fixtures saw an increase as well, by 4.1% from the
previous month to average 12.81 mb/d, up 0.51 mb/d from levels seen in February. This
increase was driven mainly by eastbound fixtures.
While fixtures from the Middle East-to-East increased by 0.47 mb/d to average
5.85 mb/d, fixtures from the Middle East-to-West also increased, but on a lower scale.
Fixtures from outside the Middle East experienced a loss of 0.08 mb/d, or 1.8%
compared with the previous month. On an annual basis, OPEC spot fixtures in March
were 1% lower than the same month one year earlier. OPEC sailings increased in
March by 0.27 mb/d or 1.1% to stand at 23.82 mb/d. Annually, the figures also reflect
an increase by 2% over last year. Middle East sailings stood at 17.47 mb/d, up by
0.23 mb/d or 1.3% from the previous month and 1% higher than a year ago. Arrivals in
almost all reported ports increased in March, with the exception being West Asia, which
declined by 0.15 mb/d, reflecting a decrease of 3.1% from a month earlier and 1% over
last year. Arrivals in North America, Europe and the Far East all increased over the
previous month by 2%, 0.7% and 3.2%, respectively. Annually, the increase amounts to
3%, 2% and 1%.
Spot freight rates for the dirty tanker sector increased in March across a number of
reported routes, with exceptions seen primarily in the clean market for West of Suez
fixtures. The strongest gains were registered for clean tankers operating in East of
Suez. VLCC freight rates saw a minor gain at the end of the month, which was mainly
attributed to the resistance shown by VLCC owners. Except for this small improvement,
the level of activity in the VLCC market remained stable during March and no preholiday
rush was noted. Freight rates for Suezmax trading in West Africa increased in
March on the back of limited tonnage availability, and date sensitivity was observed for
certain loading dates, while Suezmax trading on the Northwest Europe-to-the US ended
the month flat, with no changes from last month’s level.
Aframax freight rates were mixed in March. While freight rates improved on the majority
of reported routes, negative performance was noted on the Indonesia-to-East route. On
average, Aframax freight rates rose by 4% in March, although they remain under
pressure caused by ongoing oversupply. In comparison to March 2012, freight rates for
all reported routes registered a decline, ranging from 3% to 47%.
It is worth highlighting March’s decrease in bunker prices relative to the previous month;
prices remains much below the peak reached a year earlier. The clean tanker market
saw a different pattern in March. West of Suez remained lacking in activity with declining freight rates on all reported routes, while East of Suez freight rates increased
significantly over the previous month on the back of improved tonnage demand, high
activity and a noticeable tanker shortage on certain dates.
Generally the month of March witnessed a steady demand for VLCCs, while freight
rates remained close to last month’s levels as deals were often fixed on previous deals.
Market activities and fixtures for the Middle East saw some enhancement in light of the
requirements of the first ten days of April, following the completion of March fixtures,
which on the whole were low in numbers. Although April’s fixtures and requirements
brought improved freight rates to the VLCC market, this might be limited by
maintenance in the East.
Despite resistance to lower prices shown by VLCC owners, rates remain under
pressure, due mainly to an oversupplied market. Tonnages remain sufficient at all times
to cover all charter requirements. The VLCC tanker market situation is holding for
several routes, as it continues to be impacted by the same elements influencing freight
rates. Middle East-to-East VLCC spot freight rates slightly increased by 2WS or 6.1% in
March, compared to the previous month, to stand at 35 points. Similarly the West
Africa-to-West route increased by 2WS points to average WS36 points. This gain came
as a result of less tonnage seen at the end of the month. VLCC spot freight rates for
tankers trading on Middle East-to-West routes ended the month flat to average WS20
points, similar to the previous month, and also remained discouraging on other routes,
despite arbitrage being opened in the second week of March.
The month began with Suezmax freight rates in West Africa sliding before they
stabilised after the first week of March. Given the large vessel availability, it was not
possible for West Africa loading freight rates to achieve any remarkable increase,
despite less tonnage availability for prompt loadings and tighter vessel supply for mid-
April loading, which was the main reason behind the moderate freight rate increase
during the month. In addition, owners’ solid stand against lower freights rates held, even
during periods when fewer tankers were required. As a result, spot freight rates for
Suezmax trading from the West Africa-to-US Gulf increased by 7.5% over the previous
month to average 57 WS points. Additionally, spot freight rates for vessels operating on
the Northwest Europe-to-the US route ended the month flat to average 47 WS points.
A higher level of activity was noticed on the Northwest Europe-to-East route as a result
of fuel oil arbitrage activities. Additionally, tonnage demand was seen for Suezmax
trading on the Middle East-to-West route, though freight rates did not rise
correspondingly, as continuous tonnage supply prevented rates from achieving any
gains. The Mediterranean Suezmax market was active at a certain point in the month,
however activity levels lessened afterwards.
In the Aframax sector, spot freight rates were mixed as they increased in most reported
routes, with the exception being the Indonesia-to-East route, which dropped by WS3
points to average WS72 points. Spot freight rates for Aframax trading in the
Mediterranean saw a general increase in March, as the month started with Aframax
rates firming after tonnage availability lessened for mid-April loading. However, the
firming trend did not last long; market activity decreased and freight rates started to
ease. The inquiry level was not high enough to support the freight rate rise. Still, the
end of the month brought a rush of activities to the Aframax market. Consequentially,
Aframax tankers trading on the Mediterranean-to-Mediterranean and Mediterranean-to-
Northwest Europe routes increased by 3.5% over the previous month to average 88WS
points each. Aframax spot freight rates for trading on the Caribbean-to-US East Coast
route saw the greatest increase amid other Aframax vessels, rising on average by
10 WS points to stand at WS106 points, despite the moderate level of activity in that
area during March. However, the month started with higher freight rates, which declined
afterwards as a result of high tonnage availability and limited tonnage demand. Fog and
weather delays had no significant impact on Aframax rates in March.
Clean tanker spot freight rates were mixed in March compared to one month earlier.
Freight rates registered for East and West of Suez took on opposing patterns. In a
monthly comparison, clean East of Suez spot freight rates gained 26% in March to
average 144 WS points, while West of Suez spot freight rates declined by 9% to stand
at 161 WS points. There was a firm tendency in the East, which was noticed since the
beginning of the month and which continued as long the tonnage list got tighter,
especially for end of March/beginning of April loadings. At the same time, mediumrange
vessels benefitted from less availability of long-range vessels. Freight rates for
eastern destinations increased noticeably as the tonnage list shortened in different areas, and in combination with charter efforts to secure their requirements before the
Therefore, clean spot freight rates for tankers operating on the Middle East-to-
East route increased by a significant 30%, and rates for the Singapore-to-East route
increased by 23% in March, compared to the previous month. Nevertheless, negative
performance was registered for spot freight rates on all reported routes for clean tanker
trading in West of Suez. In fact, the freight rates registered for the Northwest Europe-to-
US, Mediterranean-to-Mediterranean and Mediterranean-to-Northwest Europe routes all
declined: by 14%, 7% and 6.5%, respectively. Generally, the West of Suez clean tanker
market was quiet and lacked activity in March, with freight rates remaining flat on many
occasions. The higher activity registered at rare times during the month was not enough
to lift freight rates, and a weaker trend prevailed.