SSY Base Oil Shipping Report


Some April business is beginning to appear on specific routes, but by no means is it across the board. That said, demand for March space seems insatiable in some areas, and occasionally owners have been able to raise freights by a substantial amount.

U.S. Gulf
Whereas it used to be common to find at least a handful of ships fully open in the U.S. Gulf, nowadays it is rare to find any prompt ship open, even with part-cargo space. Even those positions that were open later in March have now almost all gone. It is not that there is a massive amount of demand, but even with the moderate number of enquiries in the marketplace those owners who do have any kind of space have worked out that they can charge premium levels. This is especially so on the trans-Atlantic eastbound route.

Numbers for 5,000-ton parcels from Houston to Rotterdam have jumped by some $6 to $7 per ton to mid-high $50s/t. Freights have risen again on the service from the U.S. Gulf to the east coast of South America too. In addition, 5,000 tons of base oils from Houston to Santos will easily cost in the $50s/t currently, and even that is a bit notional since all the scheduled sailings for March are full.

Those aiming to send cargoes from the U.S. Gulf to the Caribbean and Mexico are also faced with rising charges. For example, a 5,000 ton cargo from Houston to the east coast of Mexico would now command a level in the low $50s/t. The U.S. Gulf to the Far East route is apparently seeing more enquiries for aromatics, and some owners are calling for rises of $15 to $20/t. Several ships were holding on to March space so such increases may be excessive, depending upon how quickly the business firms up.

Activity has been rekindled in Northwest Europe over the past week. The oil markets have led the way with better demand in the Baltic and the Mediterranean, but also chemical chartering has picked up again. Coastal markets have registered increases in freight. Southbound into the Mediterranean is full of enquiry, and there are some solid rates being booked.

The same is true northbound, where levels have risen by some 10 per metric ton on certain routes. Within the Mediterranean, there are a number of ships that are open in the East Mediterranean, fortunately for those shipping base oils out of the Black Sea into Turkey.

March space going all the way out to the Far East is limited in March, although one owner is planning on inserting an additional ship towards the end of the month, subject to finding a base cargo. Those owners who are on berth are fairly bullish in their freight ideas, and a standard 5,000 ton enquiry from Antwerp-Rotterdam-Amsterdam to scheduled, principal ports in China will attract indications in the $80s/t.

There are rather more ships available to those wanting to go to India or the Middle East Gulf, but owners are still seeking levels in the $70s/t for 5,000-ton cargoes. Perhaps the only way to achieve less is to jump on one of the ships heading out to India or Pakistan for the final voyage before being beached and broken up for scrap. In those circumstances, we see owners more willing to look at levels in the mid $50s/t.

Asian coastal markets see freights nudging up here and there by a dollar or so as demand resurfaces, especially for aromatics into China. For example, 3,000 ton cargoes from Singapore to Ulsan now typically face freights in the low-mid $30s/t.

Deep-sea business is not so exciting from Asia, with demand consisting mainly of edible oils and palm oils. Freights are steady however at around $70/t for 5,000 tons of base oils from Korea to Antwerp-Rotterdam-Amsterdam. Space exists on the route from the Far East to the United States, but base oils fail to show up on the radar, even with levels in the low $50s/t obtainable for 5,000 ton cargoes.

India and the Middle East Gulf region are especially active with really loads of cargoes being quoted. Much of this is in larger sizes too – typically 15,000 to 20,000 ton lots. There are occasionally top-up possibilities to take base oils from the Middle East Gulf and India further into Southeast Asia and the Far East on the back of these chemical shipments. For example, 5,000 ton lots from the Middle East Gulf to Singapore are priced in the high $40s/t at present and low $60s/t if going all the way up to Korea or Chinas scheduled principal ports.

Rates back into the Mediterranean and Northwest Europe are firm. Small pockets of space exist, but 2,000 tons of cargo from the Middle East Gulf to Antwerp-Rotterdam-Amsterdam easily costs $90 to $100/t. Even 5,000 ton cargoes back to Europe attract offers in the $70s and $80s/t.

Adrian Brown is senior market analyst for chemicals and base oils with SSY Shipbrokers, London. Information about SSY can be found at Adrian Brown, in the U.K., can be reached directly at or by phone at +44 1207-507507. In the U.S., SSYs Steve Rosenthal can be reached at or +1 203-961-1566.

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