Firm demand lifts Africa-bound clean MR freight rates

Firm demand lifts Africa-bound clean MR freight rates

Mumbai, 10 March (Argus) — Freight rates for Medium Range (MR) tankers shipping oil products from the Mideast Gulf to east Africa hit a 21-month high on 9 March, driven by firmer demand and higher bunker costs.

The rate for a 35,000t shipment excluding piracy fees from the Mideast Gulf to east Africa increased to $28.68/t (WS221) on 9 March, the highest since 12 May 2020. The Worldscale rate for a similar shipment on the route, including anti-piracy fees, rose by WS57.5 from a week earlier to WS260 on 9 March.

Gains in Argus' time charter equivalent (TCE) rates for similar shipments on the route were also firm, reaching a high of $13,998/d on 9 March, despite rising bunker prices.

Fuel costs have reached record highs, as Ice Brent crude futures rose above $130/bl on 9 March as the US halted imports of Russian crude and the UK announced a complete phasing out of Russian imports by the end of this year. Prices for very-low sulphur bunker fuel oil with a 0.5pc sulphur content in Singapore have increased by nearly 62pc to $1,018.83/t on 9 March from $629/t at the start of the year.

Exports from the Mideast Gulf have been robust, as product