Trick or Treat

Falling crude prices and rising crude demand has brought cheers in the tanker market once again. Specially the VLCC segment freight rates have spiked after the usual 3rd Quarter depression. VLCCs are demanding TCE of about USD50K, which is about three times higher than in ebb.

The current rally owes to the positive vibes like Iran showing signs of compromise and Fed showing signs of maintaining the momentum and speed at its money factory. Reduced fear factor has resulted in cooling the oil prices while prospects of uninterrupted  money supply has helped to push the demand. The single biggest mover, China is taking advantage of the situation and guzzling on West African crude, a better quality crude than the Gulf sour crude.

The charterers are willing to dole a treat rather than be tricked by this sudden surge in demand before the laid up tonnage cranks up to life and arrives to rescue them.