RATES TO REMAIN WEAK IN THE SHORT TERM

摘要

There is no respite for VLCC owners asrnvessel earnings are unlikely to recoverrnsoon. Although strong demolitionsrnhave capped the fleet growth since thernbeginning of the year, vessel earningsrnhave dwindled on account of seasonalrnweak demand, as well as firms bunkerrnprices. Initially, owners were upbeat,rnlooking at the 9% surge in China’s crudernimports to 9.15 mbpd in March; however,rnthis optimism proved to be short-lived asrnextended refinery maintenance in Chinarnstarted to curb demand. China’s crudernthroughput may come down by 17% asrnmajor refiners, including Sinopec refinery,rnwill undergo maintenance, spanning overrnMay and June. Overall, crude flows to thernAsia Pacific market are likely to decline inrnthe coming months as about 1.4 mbpdrnof the refinery capacity will remain closedrnfor maintenance in the second quarter,rnkeeping chartering activity weak in WestrnAfrica and Arabian Gulf. However, thernreturn of Atlantic basin refiners fromrnmaintenance and increase in refinery runsrnahead of the peak demand driving seasonrnwill support tonnage demand as demandrnfor Middle Eastern crude from the US andrnEuropean refiners will increase. Besides,rnrising US exports heading to the AsiarnPacific will also support the tonne-milerndemand for large crude carriers.