*Transatlantic Bulls
The past couple of days have seen a large jump in transatlantic routes worldscale values. The main routes that carry gasoline on MR vessels are; TC2 travelling from ARA to NY and the back-haul route, TC14 from Houston to ARA. TC2 rates in previous weeks had seen lows of WS70, however the start of this week has seen rates shoot up by over 10pts in one day, now sitting at WS97.22, evidenced by each new TC2 cargo going on subs this week testing new higher levels. Similarly as TC14 is the reverse route of TC2, it has also seen a jump in rates from low to mid WS80’s now up to WS126.43. The reason for this surge in prices can be explained by simple economics; high demand, low supply equals a price increase. As owners see a tight list of available prompt tonnage, and a growing number of cargoes, owners will be holding out for the best deals consequently increasing rates. This momentum is helping to bring back strength and confidence to the forward curve.
*LPG on the Move
In recent weeks LPG has seen a strong increase in prices. On the 10th of July the LPG AUG contract traded at 33$/mt the same AUG contract has seen a print this week at the value of 47.5$/mt, over a 40% price increase in little over a week. This along with strengthening spot values from a low of 24$ at the end of last month to its most recent print of 40$ is suggesting a bullish trend in LPG. This can be seen strengthening throughout the entirety of the curve. Recent price increases may have been driven by the announcement of the EU Emissions Trading Systems voting to include shipping emissions, as speculators are potentially hoping to see LPG prices on the rise in the near future as some vessels turn to LPG power and taxes start being levied on emissions in the industry.