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Sinokor ‘gambles big’ on VLCCs with first spot fixtures and talk of five-ship Frontline swoop
South Korean owner is stirring up sentiment in the large tanker sector

South Korea’s Sinokor Merchant Marine is making a big play in the VLCC sector chartering-in its first four spot vessels at high rates in the first week of 2024 while also being named as the buyer of five VLCCs from John Fredriksen’s Frontline.

The enigmatic owner, which already has at least 39 VLCCs under its control either as owned vessels or time-chartered tonnage, was seen chartering in the 320,000-dwt Oceanis (built 2011), 319,000-dwt Agitos Nikolas (built 2019), the 319,000-dwt Olympic Target (built 2011) and 321,000-dwt Agitos (built 2019).

Brokers said the first ships were fixed at levels that initially seemed high but now seem more realistic and have been taken on by Sinokor with no subjects, on speculation and without bank guarantees.

Tanker brokers told TradeWinds that with its existing time-chartered large tankers, Sinokor now controls 12 of the 28 VLCCs available in the Atlantic basin before 11 February or 43% of upcoming tonnage.

“We believe it is a strategic play on speculation because they believe the market is going up,” one VLCC tanker broker head said.
“They are taking a very big gamble but it looks like a gamble that is well placed,” he said, pointing out that the US Gulf to China spot market voyage has gone up over $2m in two weeks from around a lumpsum rate of $7.75m to $10m.

“It will be interesting to see how the market reacts,” he added.
Brokers are also reporting that Sinokor has privately confirmed to some that it has purchased the 297,000-dwt non-scrubber-fitted Front Signe and Front Cecile (both built 2010), along with the 297,000-dwt scrubber-fitted Front Queen, Front Kathrine and 321,000-dwt Front Endurance (all built-2009).

The vessels — the first four of which are Chinese-built with the Front Endurance constructed in South Korea — are rumoured priced at levels in the mid to high-$50m each.

Other talk priced the vessels at an average of just over $60m each.

The five VLCCs are Frontline tonnage and not among the 24 large tankers purchased by the company as part of the deal that the company struck with the Saverys family’s Compagnie Maritime Belge last year.

If confirmed, Frontline would appear to be offloading some of its older tonnage.

On manoeuvres
Sinokor and Frontline have been approached for confirmation and comment.
Frontline did not want to comment and referred to sales talk as “market speculation”.

Aside from the sale and purchase market reports, rumblings had already started emerging in the VLCC market late last week that Sinokor was on manoeuvres.
Shipbroker Braemar reported that several US Gulf-loading cargo stems remained unfixed from last week — around 11 firm US Gulf cargoes — and Sinokor did not appear to be offering its vessels for this business.

The broker said other shipowners appeared to following the South Korean owner’s lead and withholding their tonnage.
This led to market chatter that Sinokor was withholding its tonnage in an effort to force up rates before unleashing its own vessels for charter.

“It has certainly thrown a few plans out of kilter for quite a few,” one experienced VLCC hand told this publication. “It’s an interesting play that’s for sure.