Tanker Market: A Pessimistic Outlook

Wednesday, May 16, 2012

Drewry Maritime Research’s latest Tanker Forecaster report indicates that Suezmax owners got some respite in the first quarter of the year, but things are looking bleak in the longer term. Spot rates firmed on the back of buoyant demand in the Caribs, Arabian Gulf and West Africa, but rising bunker prices would have absorbed much of the increase. US demand for West African crude was the one to watch as it staged a recovery in March and underpinned Suezmax rates on the benchmark TD5 (West Africa / Caribs - US) route, with earnings surging 64% to $18,733pd. 
But the recent market strength seems a mere aberration rather than a fundamental upward shift. Fundamentals are expected to remain bearish in the near term with the supply-demand gap broadening and a larger number of vessels chasing fewer cargoes.
That lack of confidence was visible in the time charter market, with only two Suezmax vessels fixed during the first quarter. The 12-month rate for five-year old vessels averaged $17,067pd, down about 2.5% from the previous quarter.
Demand is likely to suffer from seasonal weakness in the coming quarter, while the fleet will continue to expand. Drewry expects the Suezmax supply-demand gap to widen from 12.8 million dwt to 14.8 million dwt in the second quarter, while earnings on West Africa-Caribs/USES are expected to average $11,800pd.
With the fleet growing by 7% in 2012 and 2013, market conditions will only start to improve from 2013 onwards, mainly on expected improvement in demand with recovery in the global economy.
 

Maritime Reporter August 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Tanker Trends

Algeria in Talks to Export Crude to Venezuela

Algeria is in talks to export crude oil to fellow OPEC member Venezuela, Algerian Energy Minister Youcef Yousfi said on Tuesday, confirming a Reuters report. Last week,

Joe Barton: Lift Oil Export Ban

A senior U.S. Congressman from Texas has come out in full support of the United States lifting the 40-year old ban on crude oil exports, putting him at odds with

Russia's Shipping Major Reports Strong 1H 2014

OAO Sovcomflot (SCF Group), Russia’s largest shipping company and a global leader in seaborne energy transportation and offshore services, has announced its financial

Finance

Master Fined After Wind Farm Collision

The master of a wind farm support vessel has today been made to pay £3,000 in fines and costs after pleading guilty to breaches of maritime collision regulations.

Statoil, DNV GL Drive Subsea Factory Interface Standardization

Statoil has entered into an agreement with DNV GL to establish an industrial cooperation to introduce an international industry standard for subsea process technology.

Halliburton to Settle US Gulf Spill Claims for $1.1b

Halliburton Co said it reached a $1.1 billion settlement for a majority of claims against the company for its role in the BP oil spill in the Gulf of Mexico in 2010.

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Security Naval Architecture Navigation Offshore Oil Port Authority Salvage Ship Simulators Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1069 sec (9 req/sec)