Ton Mile Trader

Crude
VLCC Ag/East      82       ($44k)   still a good fixing pace, rates still pushing
SM Wafr/Usac      105     ($27k)   maybe about same…possibly softer
AG March             96        up 6
AG April              2          up 1
Wafr March          97m        up 2
Wafr April             10m         up 6
Turkish Straits      2n/2s     same
Fujairah bunkers   475        down 5

Physical:  We still see a good fixing pace – though we also note diverging fortunes between asset classes / basins.  Vs in the Ag continue to push to the upside on steady inquiry.  A few days back I had written that the presence of seemingly unabated demand should have brought some form of rate surge – and the lack of any such surge created doubts, in my mind, that rates could move further north.  Now we see that rate increases are indeed in our midst. Mea culpa (though I still think the fixture/bbl count is a bit above the norm – implying inquiry should slow at some point).  In the Atlantic basin, however, a healthy inquiry slate has not helped SMs in the same manner – as rates/sentiment there continues to slide for the 130kt lifters.

Robert MacKenzie:  We expect a strong tanker market in 2010. We believe the strong rate environment during January exemplifies the underlying strength growing in the tanker market. A recovering global economy, coupled with contained fleet supply growth, should provide a rising year-over-year trend. The IEA forecasts oil demand to recover in 2010, and a higher degree of seaborne oil transports further augments that recovery. Fleet growth will persist, but cancellations, delays, and the single-hull phaseout should help to somewhat alleviate the negative effects of the new builds

Crude FFAs:   Very good volume as prices rise on a still-firm physical market.  TD3 March trades up 2 points to 86, which is a big move considering the MTD value is only 79.  April, a better mathematical gauge at this point, is up 5 points to 80 (though is currently offered out at that same level).  Further down the curve we see Q3 gain 1.5 points to about 70.

Clean
37kt Cont/ta          165     ($9.5k)    about same
38kt Caribs/up       165     ($9.5k)    about same
55kt Ag/East         127      ($10k)     about same, possibly touch firmer     

Physical:   The Atlantic basin is mostly unchanged as we see Cont/ta earnings on par with Caribs/Usac.  We do hear of decent demand for Usg distillates direction Central and S America.

Clean FFAs:   Very good volume on TC2 with higher prices.  Q2/Q3/Q4 all trade up a few points each to 161/159/163.  Eastern volumes have been good as well.  TC4 and TC5 April trade about flat at 140 and 128.