VLCC prices leap 12% since August

The VLCC market remains boiling hot, with four ships sold this year, while more sales are expected to be closed this week. Cash rich owners are ready to take advantage of solid, six-figure VLCC rates, which have been in play on and off since September.

Splash has taken a quick look at the the market values now, compared to August just ahead of the first VLCC spike in September.

The first VLCC transaction this year was the 19-year-old, Samsung-built 306,000 dwt Ridgebury Pride, sold for $25m to undisclosed buyers. Online portal VesselsValue set the market value for this tanker at $21.4m in August, compared to today’s value of $24.8m. It’s worth noting a one year younger VLCC was sold for $20m in January of last year.

The second ship sold so far this year was the 2005-built, 300,000 dwt VLCC Jin Ei for $35m, up $2m from August. In a comparable deal from April, a one year younger VLCC fetched $27.5m.

The last reported deals concern two Hartree Partners VLCCs – the Kiwi and the Lady – just being finished at Daewoo Shipbuilding & Marine Engineering (DSME). These vessels had a market value of about $92.8m in August, while the market value is now set at $99m.The ships have been sold for around $105m each, a tidy piece of business for Hartree who ordered them for just $83.5m in May 2018.

VLCCs spiked dramatically in September last year, and then roared back again in December and have started out this year in very strong fashion, albeit flagging in the last 24 hours to dive below the $100,000 mark for the first time this year.

“We have witnessed a very active VLCC market, with buying eagerness being on a bullish track. This is mere reflection of the better sentiment shared now in terms of the prospective future earnings.” Allied Shipbroking noted in its latest report.

Hans Thaulow

Hans Henrik Thaulow is an Oslo-based journalist who has been covering the shipping industry for the last 15 years. As well as some work for the Informa Group, Hans was the China correspondent for TradeWinds. He also contributes to Maritime CEO magazine. Hans’ shipping background extends to working as a shipbroker trainee with Simpson, Spence & Young in Hong Kong.
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