Transatlantic MR rates rally on US gasoline woes

Market: Freight, Oil products
26/08/20

Rates for Medium Range (MR) oil product tankers in Europe are being boosted by rising demand for gasoline exports to the US, as the approaching Hurricane Laura forces refineries along the US Gulf coast to shut down.

The UK continent to US Atlantic coast rate increased by 50pc yesterday to Worldscale (WS)150, or $22.95/t, the highest level since 14 May. Rates were discussed at WS140-145 today.

The US is structurally short of gasoline and imports a large amount from Europe. The recent upgrading of Laura to a hurricane and its projected path has forced several refiners in Texas and Louisiana to idle capacity or reduce runs, putting pressure on domestic gasoline production. The gasoline arbitrage window has widened as a result, and many trading firms and refiners brought a flurry of fresh MR cargoes to the European market on 24 August. This increased tonnage demand substantially overnight and led to rates shooting up yesterday.

But several cargoes have since been withdrawn from the market, including two gasoline cargoes to the US Atlantic coast from BP and Finnish firm Neste. "[Ship]owners priced themselves out," one shipbroker said, referring to offers at WS150.

Charterers may have slowed cargo bookings to wait and see the extent of the hurricane's impact. But the disruption to refinery operations so far should still have a substantial impact on US demand for gasoline imports.

By Nicolas Kyriakoglou

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Cop: Drafts point to trade-off on finance, fossil fuels

22/11/24

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22/11/24

Cop: Drafts point to trade-off on finance, fossil fuels

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Singapore light distillate stocks hit seven-week high

22/11/24

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22/11/24

Singapore light distillate stocks hit seven-week high

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Pemex's lean Zama spending undercuts goals

21/11/24

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21/11/24

Pemex's lean Zama spending undercuts goals

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Cost of government support for fossil fuels still high

21/11/24

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21/11/24

Cost of government support for fossil fuels still high

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