SSY Base Oil Shipping Report


There is some activity out of the United States, but some of the European and Asian routes have been really quiet this week.

U.S. Gulf

Charterers to the Far East continue to play cat and mouse with owners, with many freight enquiries not materializing, while some are just attempts to see how low the numbers can go. As such, there are still several ships that have prompt space and several more that are due on berth in late August. Several very large cargoes of ethylene dichloride have been covered in the $47 to $50 per metric ton region, but smaller requirements of 10,000 tons or so are finding it harder to make the economics work. Ethanol has been looking to move into the Philippines, but styrene is not yet 100 percent firm. Rates are marginally lower, but starting to stabilize. Base oils are not present these days.

Few, if any, of the recent eastbound benzene requirements have developed into serious fixing. Styrene also remains hit and miss. Instead, owners are picking up cargoes that are less arbitrage-driven, such as fishoil, glycol, cumene, ethanol and talloil. There is talk that base oils have been booked to northwestern Europe on one of the prompt vessels out of the U.S. Gulf, but most of the U.S. base oil exports are heading to Nigeria instead.

It has been fairly quiet within the Caribbean this week. It remains to be seen how much of the base oil committed to Punta Cardon, Venezuela, is shipped from the U.S. Gulf, which is what is supposed to be taking place.

Several base oil opportunities have been seen heading from the U.S. Gulf to Brazil, including one that should have been a contractual shipment. Another small lot of around 2,000 tons has been fixed from the U.S. Gulf to Brazil. The route southbound into the east coast of South America has been rather lethargic, lacking the usual caustic, paraxylene and styrene, although there is talk that ethanol, caustic and paraxylene are all making a comeback for later this month.

Contractual volumes to India and the Middle East Gulf are steady. In addition, traders have been evaluating cargoes of ethanol and ethylene dichloride to India as an alternative to selling the material into Asia or Europe. Some base oils have also been noted from the U.S. Gulf into Mumbai. There is also a shipment of 6,000 tons of base oils that has just loaded in Fortaleza, Brazil, for Mumbai, India.


The spot market in the North Sea and Baltic regions has been rather dull this week, leading to a rise in the amount of prompt open tonnage. Fewer base oils have been noted, and indeed the only products that seem to have much life in them have been those which are linked to gasoline, such as pyrolysis gasoline, heart-cut benzene and biodiesel.

A couple of Mediterranean-based ships open in Antwerp-Rotterdam-Amsterdam are still finding it hard to find the ideal cargoes on their way back southbound into the Mediterranean, but overall, the volume of business is satisfactory if not hugely exciting. Some small lots of base oils have been quoted into Turkey and Egypt. Otherwise, most cargoes have been fixed fairly quickly, implying that owners are not confident about hanging back to see if they can get better rates.

Northbound demand has not been anything dramatic this week, and most cargoes have been matched up with vessel space rather quickly. A couple of pyrolysis gasoline cargoes did have vetting issues, but managed to get fixed all the same. Rates have been soft on the whole, with the exception being cargoes that have been strict on loading dates and, for example, one of the methanol cargoes which was loading in unpopular Libya.

Inter-Mediterranean business has improved in the West Mediterranean with the return of biodiesel, with at least a dozen fixtures conducted during the past week. Rates are a little up in some cases, but whilst they may be up from last week, they are only back to where they were two weeks ago. Aside from FAME, cargoes of MTBE, styrene, benzene, caustic, methanol, ethanol, and clean petroleum have helped owners cover the bulk of their prompt positions. Base oils have not really featured much this week.

Apart from paraxylene, there has not been a great deal on westbound transatlantic routes. However, with prompt space in relatively tight supply, it was rather surprising to see the next 8,000-9,000 tons of paraxylene from Rotterdam, Amsterdam, to Mexico actually go in the mid $40s/t, after having predicted it would have been back in the $30s/t again. All the same, the next 7,000 tons of paraxylene to Charleston, South Carolina, has been fixed on subjects at just $29/t, and makes it hard to apply any logic to the route. Base oils in the amount of 7,000 tons have been quoted from Antwerp-Rotterdam-Amsterdam to Punta Cardon, and 1,700 tons of base oils were covered from Fawley, United Kingdom, to Houston, the rate for which is understandably far above the rates seen for the bigger lots of paraxylene, etc.

Europe-based traders have been attempting to ship paraxylene and styrene to Asia, with cargoes quoted both from northwestern Europe and the Mediterranean. Several cargoes of base oil have also been noted, with some quoted from the Baltic and others from the Black Sea. Rates are stable for the moment.

There has been a fairly steady procession of cargoes to India and the Middle East Gulf quoted through the week, from the usual 1,000- to 5,000-ton lots of solvent naphtha C9 and solvent naphtha, as well as oxo alcohols and some base oils, all the way up to 10,000-ton slugs of ethylene dichloride and paraxylene. A couple of ships can still take August cargoes, so rates remain unchanged.


There are some who believe that activity is a little better on some of the Asian routes, including the intra-Far East route. Certainly there have been more cargoes of paraxylene, benzene and glycols moving between Korea and China, yet despite this, rates are reported to have gone down a little this week. The majority of these cargoes are loading in August and early September, which tallies with reports that the Chinese authorities will instruct some factories to cease production during the G20 summit in China in an attempt to reduce pollution levels during the event.

Northbound is also showing more promise with the restart of an aromatics facility in Singapore that has already seen 20,000 tons of paraxylene booked into Northeast Asia. Several more aromatics units are expected back on-stream in Southeast Asia, which should provide more shipping demand shortly. However, southbound traffic has been minimal back into Southeast Asia this week, and intra-Southeast Asia trades are also pretty quiet.

Following recent benzene and paraxylene fixtures being exported across the Pacific, things have quieted down considerably and there is still some prompt space to be had. The situation in the second half of August is tighter, with some of the regular carriers full until September. The market into Europe is subdued and several ships still have August space.

Freight rates in India and the Middle East Gulf continue to decline, thanks to poor demand and an oversupply of tonnage in the area. A slug of 19,750 tons of glycol from Al Jubail, Saudi Arabia, to Merak, Indonesia, was reportedly fixed at just $23/t-$24/t. Easy chemicals in the amount of 13,000 tons from Al Jubail to the Black Sea region were worked at an amazingly low rate of $31/t, though that deal fell apart due to the unsuitability of the vessel, and the charterer subsequently attempted to woo owners with numbers in the mid $30s/t, but such levels are at least $10/t lower than normal. Such is the oversupply of ships there, some of which have not managed to fix anything but short hops locally with clean petroleum.

Adrian Brown is a senior market analyst for chemicals and base oils with SSY Shipbrokers, London, can be reached at or +44 12 0750 7507. Information about SSY can be found at In the Houston office, Panos Giannoulis of SSY’s Chemical Tanker Department can be reached directly at or +1 (713) 652-270 and Jordi Maymi in Singapore can be reached at +65 6854 7127.

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