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Wednesday, October 17, 2018


Continued market volatility – Bassøe Shipbrokers

According to the Bassøe monthly report for August, a volatile VLCC market can be expected in the months ahead. The reasons for this are: the psychological effect of the OPEC’s 25 July 1 mbd production cut, OPEC overproducing by an estimated 0.9 mbd (IEA estimate) before the September cuts, and the increase in July of VLCC fixing for August. Moreover, Bassøe reports, the Tankers International pool has been instrumental in pushing the market up through their message of not fixing below WS 40. Still the market has a finely tuned supply/demand balance. Bassøe expects the market to be influenced in September by the extent to which the OPEC countries adhere to new production quotas as well as western hemisphere oil demand development before the winter season. The macro fundamentals, including the Asian financial situation and the OECD area GNP growth, are anticipated to have only a marginal short-term effect.