Long Range tanker freight rates on the Mediterranean-Japan route, basis 55,000 mt, have dipped to a 15 week low on the back of a closed naphtha arbitrage to Asia, as per sources in Platts. The freight rate on the Med-Japan trip fell to US$33.64/mt (US$1.85 mln lump sum) - the lowest assessed by Platts since October 23 at US$32.73/mt. Shipping sources pegged freight within a range of US$1.85-1.90 mln lump sum as no fresh cargoes were reported for the Med-Japan route.
"Naphtha arb to the East is totally closed. There is only the reformate arb which is workable," a shipbroker said. The naphtha arbitrage was unworkable, sources said, because there was an overhang of previously-fixed arbitrage cargoes that remained to be cleared in Asia. However, demand in Asia remained supported by high reforming and cracking margins from naphtha for petrochemicals end users in the region. The front-month east-west spread continued to weaken, assessed at US$22/mt Thursday, down from US$25/mt.
06-Feb-16 
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