Securing a suitable vessel should not be the last step in a fuel transaction.
Securing a suitable vessel should not be the last step in a fuel transaction.
We can agree on a product, price and loading window, but the transaction still needs a vessel that fits the cargo, ports and timing.
The challenge is not simply the number of ships in the market. Affinity’s October fleet review reports fleet growth, while Hafnia has highlighted longer product-trade routes and LR2 vessels moving into crude employment. More vessels overall does not necessarily mean suitable clean tonnage is available in the right place.
Time-charter business is still being concluded. Scorpio’s September announcement of three-year charters for two LR2s and an MR demonstrates that. However, those fixtures do not tell us what a different vessel should cost today or whether it will suit a particular programme.
For trading across the Mediterranean, Black Sea and African markets, the requirement needs to be clear from the outset:
Vessel size and cargo compatibility.
Delivery position and dates.
Charter period and permitted trading areas.
Port restrictions, vetting and insurance requirements.
Redelivery terms and the cost of positioning.
The daily hire is only one part of the calculation. Bunkers, idle time and the distances between cargoes can make a seemingly attractive charter expensive very quickly.
My view is that shipping needs to be worked alongside the product negotiation, not brought in once everything else has been agreed. Alternatives also need to be realistic, rather than relying on a vessel becoming available at the last minute.
The objective is dependable carrying capacity that fits the business. A competitive product price means little if we cannot move the cargo when required. #DrakensbergEnergy #ProductTankers #TimeCharter