CITIC Securities says Oct 2026 vessel attacks in the Middle East exceeded
September, adding volatility to freight. VLCC 1‑yr time‑charter rates remain
stable, but last week’s spot pullback triggered market concern. Short‑term cargo
release rhythms and rising attacks have disturbed spot flows; effective demand
is climbing while increased Middle East loadings are squeezing tanker supply.
With peak‑season cargoes set to concentrate, VLCC rates are likely to resume an
upswing. Converting non‑compliant vessels to compliant status faces class
certification, insurance and other hurdles, and older fleet age means net
effective capacity loss is likely under 20 ships. Current rate pressure stems
from strong upstream export demand and downstream inventory draws that tighten
crude transport; persistent regional tensions make shipping tightness unlikely
to ease. Ongoing downstream draws are building restocking demand and should keep
crack spreads elevated. Monitor news‑driven oversold moves as tactical
positioning opportunities.
