Refined Products, Maritime & Shipping, Crude Oil, Fertilizers, Chemicals, Fuel Oil, Bunker Fuel

March 01, 2024

Platts launches Global VLCC TCE Index March 1, 2024

Platts, part of S&P Global Commodity Insights, has launched a new daily weighted VLCC time charter equivalent (TCE) index, named GVI 7, basis 0.5% sulfur bunker fuel and scrubber-fitted ships along with new TCE assessments, reflecting ton-mile demand on seven key TCE assessments from March 1, 2024.

With global seaborne crude trade flow witnessing unprecedented change and expansion this decade amidst the sprouting of new production as well as consuming regions, the VLCC market currently lacks a weighted TCE index based on trade flow volume.

Capturing the prevailing crude trade flow and reflecting the substantially altered movements on the VLCCs, will help represent the spot market accurately.

The GVI 7 (basis 0.5% sulfur bunker fuel) and GVI 7S (basis scrubber-fitted) assessments for standard VLCC non-eco and eco-designed ships respectively are derived by applying an allocated weighting to the daily VLCC TCE assessments of seven key round voyages; amongst which three key round voyages are published at the 4:30 pm (0830 GMT) Singapore close, three key round voyages published at the 1:30 pm (1930 GMT) Houston close and one key round voyage published at 4:30 pm (1630 GMT) London close.

With VLCC ship designs evolving towards greater fuel efficiency, the market has witnessed the emergence of various VLCC types, including those equipped with scrubbers and eco-designed. This diversification has resulted in different VLCC categories showing disparate daily returns. The TCE rates for VLCCs offering the option of scrubber and eco-designs aim to reflect the daily upper and lower bounds in the market. The dual indexes offer the market a clearer insight into TCE earnings across different VLCC types.

The new VLCC TCE assessments launched along with the Global VLCC Index are:

1. Ras Tanura -Ningbo
2. Ras Tanura -Galveston
3. Ras Tanura -Rotterdam
4. Offshore Galveston- Ningbo
5. Gebig -Qingdao
6. Corpus Christi -Rotterdam
7. Djeno- Ningbo

GVI 7 and GVI 7S indexes will not be published on days when any of Singapore, London, Houston, or all three locations are out on a public holiday.

Weighting for the individual TCE assessments is determined by the volume of VLCC vessel movements observed between the regions associated with the respective voyages from Platts trade flow software Commodities at Sea. It is calculated in ton-miles.

Ton-mile demand is calculated by multiplying the volume of cargo moved in metric tons by distance traveled in miles.

The weightings allocated for the TCE assessments are based on flows observed over Jan. 1, 2020, to Dec. 31, 2022:

Route Voyage Symbol Code 0.5% bunker fuel, Non Eco Design Symbol Code (3.5% bunker fuel and Eco Design ) Weighting

Route Voyage Symbol Code (0.5% bunker fuel, Non Eco Design) Symbol Code (3.5% bunker fuel and Eco Design ) Weighting
Ras Tanura -Ningbo DRTNA00 DRTMA00 64%
Ras Tanura -Galveston DRTNB00 DRTMB00 2%
Ras Tanura -Rotterdam DRTNC00 DRTMC00 1%
Offshore Galveston - Ningbo DOGNB00 DOGMB00 8%
Gebig - Qingdao GQBLS00 GQBLR00 8%
Corpus Christi - Rotterdam CCRBS00 CCRTS00 1%
Djeno - Ningbo DFRCN00 DFRCM00 16%

The GVI 7 TCE index appears in Platts Dirty Tankerwire and on Shipping Alert pages SHP0302, SHP0304 under the following price database codes:

Daily Monthly average
GVI 7 Basis bunker fuel 0.5%, Non Eco VGIBS00 VGIBS03
GVI 7S Basis scrubber-fitted, Eco VGIBR00 VGIBR03

Please send all comments or questions to shipping@spglobal.com and pricegroup@spglobal.com .

For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing. Platts will consider all comments received and will make comments not marked as confidential available to the public upon request.