Register with us today

and in less than 60 seconds continue your access to:Latest news headlinesAnalytical topics and featuresCommodities videos, podcast & blogsSample market prices & dataSpecial reportsSubscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Please Note: Platts Market Center subscribers can only reset passwords via the Platts Market Center

Enter your Email ID below and we will send you an email with your password.

  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you your password for security reasons. Please contact the Client Services team.

If you are a Platts Market Center subscriber, to reset your password go to the Platts Market Center to reset your password.

In this list

Tanker companies look to switch LR2s into dirty market on rate strength

Natural Gas | Oil | Crude Oil | Gasoline | Jet Fuel | Steel | Raw Materials | Petrochemicals | Shipping

Market Movers Europe, July 22-26: Middle East tensions keep oil markets on edge


Platts Dirty Tankerwire

Commodities | Metals | Non-Ferrous | Shipping | Autos & Capital Goods | Materials | Building & Construction | Transportation | Financial Services

Aluminum Symposium

Natural Gas | Shipping

US gives Freeport LNG permission to flow gas to first train for commissioning

Tanker companies look to switch LR2s into dirty market on rate strength

Houston — Tanker companies are moving Long Range 2 tankers carrying product cargoes to the dirty Aframax market to capitalize on strong crude-export sentiment, with Ardmore Shipping having seen nine LR2s switching into the dirty trading environment in the third quarter, Anthony Gurnee, the company's CEO said Wednesday.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

Ardmore is planning to only switch older tonnage over to the Aframax sector, Gurnee said during the Q3 2018 earnings call, but expects a continued flow of LR2s into the dirty market into the near future.

"There's a lot of LR2s trading clean that are in the hands of mixed fleets or are a little older, and it would make sense to switch over," Gurnee said. "And it's very tempting because the rates on Aframax routes have been much stronger, and we think that will continue."

Commodities Spotlight podcast: US Gulf Coast crude exports -- a sea change to dirty tanker markets

The dirty tanker market has been especially strong to start Q4 2018, with rates for Aframax vessels on the US Gulf Coast-UK Continent route, which have the same 80,000-120,000 deadweight tonnage as LR2 tankers, currently averaging over 70.6% higher so far for Q4 than that of Q3, according to S&P Global Platts data.

Ardmore is not the only company impacted by the advantage of making the switch.

International Seaways has yet to switch their lone LR2 tanker to carrying dirty cargoes, company President and CEO Lois Zabrocky said in their Q3 earnings call, which also took place Wednesday morning, However, the company will continue to monitor rate movements into the rest of Q4, Zabrocky said.

The company, Zabrocky said, is looking to capitalize on "a stronger rate environment in the fourth quarter as [the market] has surpassed the [rate] cycle's lowest point."

The discussion of the movement of clean tankers into the dirty market comes exactly a week after Scorpio Tankers, who owns a fleet of 38 LR2 tankers, pointed to the advantage of this switch in their third quarter earnings call. Scorpio has not specifically announced any change in their clean tanker fleet, however, the company said that this trend has proven beneficial to business.

In the spot market, freight for Aframaxes making the USGC-UKC run were last assessed Wednesday at Worldscale 180 or $23.81/mt, down w5 points on the day. In the paper market, 70,000 lots were last traded for the Aframax USGC-UKC December 2018 contract at w140 on November 6.

--Catherine Wood,

--Edited by Derek Sands,