Asian aframax charter rates may drop first time in five weeks

Asian aframax charter rates may fall for the first time in five weeks on slowing demand for March shipments, following a drop in chartering rates for bigger tankers.

The rate to transport 80,000 metric tons on an aframax from Kuwait to Singapore dropped 0.8 percent to Worldscale 158.75 on March 7, according to data from the London-based Baltic Exchange. The rate on the route has risen 11 percent for the past four weeks. Shipping a ton of fuel on the route costs $14.96, based on data compiled by Bloomberg.

Aframax rates have been tracking fees for VLCCs, or supertankers, plying the Middle East-to-Japan route since February. The rate for a very large crude carrier, which carries 2 million barrels of oil, on the Middle East-to-Japan route slumped 21 percent last week, the first decline after rising three weeks before.

"The VLCC market is coming off and it may affect the aframax market," Katsunori Nishikawa, general manager for chartering at Matsui & Co. in Tokyo, said by phone.

Only one aframax, capable of moving 104,493 tons of cargo, is scheduled to arrive in Singapore next week, from three this week, with capacity totaling 271,753 tons, according to Bloomberg data. That compares with six last week, with a combined capacity of 663,110 tons.

The following is a table of rates to charter smaller tankers capable of carrying less than 1 million barrels of crude oil or oil products on Asian routes as of March 7, according to the Baltic Exchange.