Transatlantic clean ship rates seen staying muted

* Heating oil demand seen boosting MR demand in Q4

* LR market seen struggling to make big gains

LONDON, Oct 9 (Reuters) - Clean tanker rates for refined petroleum products on top export routes were broadly steady on Tuesday with lighter business capping earnings in the transatlantic market.

Rates for medium-range (MR) tankers for 37,000 tonne cargoes from Rotterdam to New York were at W129.38, or $7,760 a day when translated into average earnings, compared with W130.00 or $7,555 a day on Monday and W131.46 or $7,752 a day last Tuesday.

"The fronthaul transatlantic MR market continued to soften last week as enquiry slowed. The cargoes that were put forward were almost exclusively for mid-month dates, reducing prompt demand and ensuring charterers were in no rush to fix," broker SSY said.

In September, MR rates reached their highest in six months.

"Product tanker rates declined modestly ... as an increase in the available supply of tankers in the Atlantic was largely offset by declining bunkers," Deutsche Bank said, referring to lower fuel costs.

In April last year, rates reached their highest since 2008 on a jump in U.S. gasoline demand, helping reduce the number of tankers available for hire. Since then, average earnings have remained volatile.

"The product market largely favours MRs in the short-term particularly as we head into the winter and Asian middle distillate demand will be augmented by heating oil builds in the Atlantic and rising product imports from the refinery-deficient regions of Latin America and West Africa," consultants MSI said.

Average earnings per day are calculated after a vessel covers its voyage costs such as bunker fuel and port fees. Negative rates indicate costs are greater than earnings.

Analysts said reduced refinery capacity in the Atlantic Basin could boost long-haul demand for the wider products tanker sector in coming years, helped by the delivery of fewer tankers.

Typical Long Range 2 or LR2, 75,000 tonne shipments on the Middle East Gulf to Japan route were at W101.45 in the worldscale measure of freight rates, or $10,929 a day when translated into average earnings, from W101.25 on Monday or $10,052 a day and W100.23 or $9,309 a day last Tuesday. In July rates hit their highest level since late October of 2011.

Brokers said the LR2 market saw brisk demand to book vessels in recent days.

"With LR1s still struggling, (LR2s) are finding any real increases tough," broker E.A. Gibson said.

Long Range 1 tankers, carrying 55,000 tonne loads from the Middle East Gulf to Japan, were at W108.25 on Tuesday, from W107.86 on Monday and W110.42 last Tuesday.

In the Mediterranean, 30,000 tonne shipments ex-Algeria to southern Europe were at W163.61 on Tuesday, versus W158.28 on Monday and W158.14 last Tuesday.

(Reporting by Jonathan Saul; editing by James Jukwey)

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