Market slowdown

Time charter rates in the smaller chemical tanker vessel sizes are expected to remain stable for the next two years, but rates for the larger sizes, especially MRs, will decline due to the impact of falling clean petroleum products (CPP) freight rates, according to Drewry. Weakened chemical tanker freight rates in the second quarter of 2016 have resulted in softer time charter rates. Drewry anticipates a modest improvement in the CPP market in the next two quarters, but expects chemical tanker freight rates to remain weak in the third quarter with a pick up in the fourth quarter of this year. This is because demand from China will reduce as plants shut down from end-August to early September for the G20 summit.