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

Tanker Trends

Bill Promotes US LNG Vessel Transport

Congressman John Garamendi (D-CA-03), Ranking Member of the House Transportation and Infrastructure’s Coast Guard and Maritime Transportation Subcommittee, introduced H.

Kurdish Crude Oil Tankships: End-Game Still in Doubt

After a legal show-down in Texas this week, the outlook for a handful of tankers holding some $300 million worth of Kurdish oil is not looking good. Seemingly

Korea Shipbuilder Wins US$400-M Greek Order

Daewoo Shipbuilding & Marine Engineering Co., South Korea’s second-largest shipbuilder, says it has signed a contract to build 4 tankships for Maran Tankers Management,

Finance

Fortis Earns $47 mi in the 2Q 2014

Fortis Inc. achieved second quarter net earnings attributable to common equity shareholders of $47 million, or $0.22 per common share, compared to $54 million, or $0.

Japan Loans Petrobras $500m to Build Ship Platforms

Brazil's state-controlled oil company Petrobras signed on Friday a $500 million loan from Japan to build eight ship platforms for the oil industry, as part of the

SEACOR Holdings Announces Q2 Results

SEACOR Holdings Inc. has announced its results for its second quarter ended June 30, 2014. For the quarter ended June 30, 2014, net income attributable to SEACOR Holdings Inc.

 
 
Maritime Careers / Shipboard Positions Maritime Standards Naval Architecture Offshore Oil Pipelines Pod Propulsion Ship Repair Ship Simulators Shipbuilding / Vessel Construction Winch
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: 0.1001 sec (10 req/sec)