Saad Rahim is the chief economist at Trafigura, a major trading company. He said that the shadow fleet of oil tanks has grown following Western sanctions against Russia for its war in Ukraine.

The shadow fleet plays a crucial role in ensuring that Russian crude oil is available to buyers, despite the sanctions aimed at reducing Moscow's oil revenue.

Rahim said at the APPEC conference 2025 that the shadow fleet has grown larger as sanctions and restrictions have increased.

Shadow tanker fleet growth has been slower this year. However, the fleet is still growing as new vessels are replacing those on blacklist.

Rahim also said that the U.S. tariffs have so far had a limited effect on global economic growth and fuel demand.

The key thing about tariffs is we haven't really seen an impact on demand yet," said Rahim. He added that it has not been long enough for the August 1, 2018 tariffs to show up.

He added that "Companies have pre-tariff inventories that they can draw from at prices they don't have to pass on to consumers yet."

Rahim said that producers will set their capital budgets for the next few month in light of $60 per barrel oil prices as the break-even point.

The number of U.S. Oil Rigs has also decreased, and production is expected to stagnate at its current level.

The number of drilling rigs has dropped by 25%, according to Rahim. He added that it takes time for the reduced rig count in the field to have an impact on production.

He said: "You won't notice the decrease (in production), yet, because there's a six- to eight-month lag. But I believe you'll see production begin to stagnate at these levels, and then possibly come down."

(source: Reuters)