The tanker market in mid-March 2025 shows stark contrasts. VLCCs face an eerie calm in the U.S. Gulf amid Trump’s tariff uncertainty, while Suezmax rates soar with tight tonnage in Europe and West Africa. Aframax softens slightly, as clean tankers—MR and LR—see mixed fortunes: LR2s spike in the MEG, but MRs lag in the U.S. Gulf. New U.S. sanctions on shadow fleet VLCCs and tugs, plus potential Iranian interdictions, rattle the sector, with $1.5M port fees looming for Chinese-built ships. Investors eyeing tanker stocks navigate a landscape of regional strength, geopolitical risks, and trade shifts.
This update covers VLCC, Suezmax, Aframax, MR, and LR trends, plus key external drivers. From rate movements to sanction shocks, here’s the latest—volatility’s in the spotlight.
⏬ VLCC Market: U.S. Silence, MEG Stirrings
VLCC rates edged up slightly, with MEG to China (TD3C) at WS 58.55 ($39,305/day round-trip TCE) and West Africa to China (TD15) at WS 59.63 ($41,173/day TCE).
U.S. Gulf to China (TD22) held at $7.292M ($35,834/day TCE), but spot activity there turned eerily quiet—rates dipped to $35,700/day, a 13.1% weekly drop—as Chinese buyers pause amid Trump’s tariff flux.
Activity picked up late week in the MEG, with 25-31 March cargoes overlapping early April stems, leveling rates as owners resist further downside.
Atlantic tonnage thinned as Brazil and West Africa absorbed ships ballasting from the East, yet U.S. Gulf softness persists—Chinese buyers favor Panama and Canada.
Sanctions hit six VLCCs, including the 300,000-dwt Itaugua, scuppering its recycling deal in Bangladesh.
A Ukraine-Russia ceasefire could flood markets with Russian oil, easing pressure on Iran’s 1.8M bpd exports—VLCCs might see shifts if U.S. “maximum pressure” intensifies.
Investors could find stability in MEG gains, but U.S. uncertainty looms large.
⏳ Suezmax Market: Tightness Drives Gains
Suezmax owners seized momentum, with Nigeria to UK Continent (TD20) jumping 10 points to WS 98.75 ($42,938/day TCE) and CPC to Med (TD6) soaring 23.5 points to WS 123.30 ($57,961/day TCE) for early April stems.
Guyana to UK Continent (TD27) rose to WS 94.17 ($39,899/day TCE), and MEG to Med (TD23) hit WS 92.5—Europe and West Africa cargoes slashed tonnage, forcing charterers to pay premiums for April laycans.
WS 120 was reported on subs for CPC/Med, with sub-price cap Urals trade adding demand pressure.
The U.S. Gulf lags, with tight tonnage undermined by cheaper Aframaxes below WS 145—though thinning Aframax lists for lightering may stabilize rates.
MEG lists are balanced, but Western strength could draw ships via the Cape or Red Sea.
Owners hold the upper hand—investors might see sustained upside if cargo flows persist.
⏱️ Aframax Market: Soft Spots Persist
Aframax markets eased, with North Sea’s TD7 (Cross-UK Continent) flat at WS 107.5+ ($26,000/day TCE) and Mediterranean’s TD19 (Cross-Med) down 5 points to WS 115.39 ($26,200/day TCE). Across the Atlantic, TD26 (Mexico/U.S. Gulf) slipped to WS 126.11 ($22,272/day TCE), TD9 (Covenas/U.S. Gulf) to WS 123.13 ($21,439/day TCE), and TD25 (U.S. Gulf/UK Continent) fell 10 points to WS 131.11 ($29,402/day TCE).
North Sea activity stayed sporadic, pushing natural dates to late March—rates need tighter tonnage to lift.
Mediterranean lists look healthy, but firm Suezmax rates curb part-loading, with third-decade stems fuller than the second.
Sanctions tagged two Aframaxes (e.g., 104,000-dwt Corona Fun), hinting at shadow fleet risks—softness may linger unless regional demand firms.
Investors might eye thinning lists as a potential floor, but gains remain elusive.
1 Year T/C - VLCC SUEZMAX AFRAMAX ECO / SCRUBBER - March 12th
⏸️ MR Market: Steady East, Sluggish West
MR tankers showed regional splits. MEG’s TC17 (35kt MEG/East Africa) hovered at WS 205-210, stable despite LR gains, reflecting consistent demand.
UK-Continent’s TC2 (37kt ARA/U.S. Atlantic) rose from WS 138.75 to WS 159.06 ($18,285/day TCE), and TC19 (37kt ARA/West Africa) climbed to WS 179.69—gradual Western improvement.
U.S. Gulf MRs stalled—TC14 (38kt U.S. Gulf/UK-Continent) stuck at WS 85, TC18 (U.S. Gulf/Brazil) at WS 135-137.5, and TC21 (U.S. Gulf/Caribbean) edged to $414,286—torpid amid tariff uncertainty.
Sanctions hit the 45,700-dwt Polaris 1, signaling shadow fleet exposure.
The Atlantic Triangulation TCE rose to $19,667 from $17,176—MRs hold steady in the East, but Western softness caps upside for investors.
⏹️ LR Market: MEG Strength, Mixed Elsewhere
LR tankers saw MEG-driven gains. LR2s on TC1 (75kt MEG/Japan) spiked 21.67 points to WS 151.67, and TC20 (90kt MEG/UK-Continent) hit $3.89M (twice reported on subs), reflecting hot demand. LR1s followed, with TC5 (55kt MEG/Japan) up 30.94 points to WS 167.5 and TC8 (65kt MEG/UK-Continent) rising to $3.1M—significant weekly jumps.
West of Suez, TC15 (Med/East) ticked to $3.1M, but UK-Continent’s TC16 (60kt ARA/West Africa) dipped to WS 110.94, muted by weak momentum.
DIS’s four Chinese-built LR1s face $1.5M U.S. port fees, potentially skewing trade—owners may sell or reroute.
LR strength in the East offers upside, but Western quietude and tariff risks temper the outlook—investors might weigh regional plays.
🌐 Geopolitics & Risks: Sanctions and Fees Loom
External pressures are mounting. U.S. sanctions hit 10 tankers (six VLCCs, two Aframaxes, one MR, one Panamax) and three tugs aiding Iran’s shadow fleet, disrupting recycling (e.g., Itaugua) and STS ops off Malaysia/Singapore.
A Ukraine-Russia ceasefire could boost Russian oil, easing Iran’s 1.8M bpd exports—U.S. interdiction plans via the Proliferation Security Initiative add uncertainty.
Trump’s $1.5M fees on Chinese-built ships (71% of new tankers) threaten owners like DIS—asset prices could split, with non-Chinese ships rising.
U.S.-China tariffs (20% vs. crude levies) quiet U.S. Gulf VLCCs—investors face shifting flows and cost hikes.
🚨 Outlook: Regional Divides Persist
VLCCs may stabilize if MEG activity holds, but U.S. Gulf weakness and Iran risks cloud the picture—a Russian oil surge could shift demand. Suezmax strength could deepen with tight tonnage—Western demand may pull MEG ships. Aframax softness lingers without cargo lift, while MR and LR shine in the MEG but falter West of Suez. Sanctions and fees could favor non-Chinese tonnage, raising freight costs—investors might find Suezmax and LR upside, tempered by VLCC and Aframax caution.
💬 Your View?
Bullish on Suezmax gains, or wary of VLCC quiet? Share your take—let’s unpack it! 🚢
*The Worldscale (WS) rate is a system used to calculate tanker freight rates, where WS 100 represents a standard base rate for a specific route. Rates above or below this benchmark indicate how much more or less a charterer will pay relative to the base cost. A higher WS rate means better earnings for shipowners, while a lower WS rate means lower transportation costs for charterers.