Changing trade patterns continue to support mid-size tanker rates while product tanker rates surge on high demand.

Looking at spot tanker rates over the past month, we have seen a very unusual situation emerge in that the market has essentially been “inverted” with product tanker rates averaging higher than crude. Within the crude tankers, Aframaxes have been the best performer, followed by Suezmax, with VLCCs being the worst of all.

Looking ahead, we expect VLCC rates will recover as China exits COVID lockdowns, while mid-size tanker rates should continue to benefit from trade route disruption as a result of Russia’s invasion of Ukraine. Although there are some headwinds on the horizon in the form of a slowing global economy, we expect that longer voyage distances and low fleet growth will continue to support spot tanker rates in the months ahead.

Watch Christian Waldegrave‘s monthly tanker market update for more.