S&P Global Platts has started publishing new daily time charter equivalent (TCE) assessments on four key Aframax routes originating West of Suez in Europe, effective April 1, 2021, due to growing interest from tanker market participants looking for further transparency on tanker earnings.
TCE assessments have been launched for the 100kt Baltic-UK Continent, 80kt UK Continent-UK Continent, 80kt Ceyhan-Mediterranean, and 80kt Black Sea-Mediterranean routes.
The TCE assessments reflect the net daily revenue of vessels operating on key dirty tanker routes in the European shipping market and are published in US dollars/day.
These assessments are derived from existing Platts spot freight rate assessments, on a $/mt basis, for the respective routes and bunker fuel prices published by Platts.
The port charges, vessel speed, and bunker fuel consumption used in the TCE calculations are arrived at by extensive market survey and reflect market practice. All assessments are basis loading and discharge on Sundays and Holidays included per weather working day at both ends, sea margin of 5% and total commission at 2.5%.
Following the introduction of new sulfur limits in marine fuel by the International Maritime Organization from Jan. 1, 2020, and the significant share of vessels fitted with scrubbers to comply with these regulations, Platts is publishing two sets of TCEs for each route: one for scrubber-fitted vessels reflecting the use of 3.5% marine bunker fuel, and one for non-scrubber fitted vessels reflecting the use of 0.5% marine bunker fuel. For ECA zones, Platts reflects the use of 0.1% marine bunker fuel.
In addition, Platts understands that bunker fuel is often purchased one to two weeks ahead of vessel loading. As such, to better reflect daily earnings, especially in periods of high volatility in bunker fuel prices, Platts is publishing three sets of prices for each route, reflecting bunker fuel costs at various periods -- on the day of assessment, one week prior to the day of assessment and two weeks prior to the day of assessment.
The new tanker TCE assessments are:
The TCE calculations are based on:
All the TCE assessments reflect loading and discharge time of 2 days each, as well as 0.5 days of waiting.
For more information on the terms used in the TCE calculations, please refer to the Platts Global Freight Specifications Guide: https://www.spglobal.com/platts/PlattsContent/_assets/_files/en/our-methodology/methodology-specifications/global_freight.pdf
For more information about the assessments themselves, please refer to the Tanker Freight TCEs FAQ: https://www.spglobal.com/platts/PlattsContent/_assets/_files/en/our-methodology/methodology-specifications/wet_freight_tce_faq.pdf
The assessments are published in the Platts Dirty Tankerwire; on Platts Global Tanker pages 1954 and 1955, Platts Shipping Alert pages 1460 and 1461, and Platts Global Alert page 0911; as well as in the Platts price database under the codes above.
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