(+) Tankermarkedet – oppdatering

Politics and Tankers: It’s no secret that the war in Ukraine has been the main driver behind the astronomically bull tanker market, hence when things started boiling over in Russia during the weekend, the tanker market participants were following closely, but it seems we are back to normal» again after a quick settlement was struck in what seemed almost like a psyop.
25. June 2023 – RESEARCH

Last week we shortly discussed the aviation market ⌨ and if the Paris Air Show this week told us one thing, then it is Aviation is back» with a record number of plane purchases taking place, with airliners such as IndiGo, India’s largest airline placing an order of 500 Airbus planes. Of course, these numbers and orders do not tell us much about today’s market, but it tells us a lot about the growing Asian market within aviation tourism and travel, which will drive the future growth of aviation fuel. Moving on from Jet Fuel, we are after all facing the market, and we are feeling the impact of the seasonal slowdown, but with this week’s resistance in the LR segment at still high earnings, it proves to us a well-bolstered clean tanker segment.

DPP/CRUDE:
The VLCCs had a somewhat flat week without any hikes or drops to worry about. Going forward, the development of VLCCs in WAF will be interesting to follow as Nigeria is tying off their tax schemes. No doubt that there is some seasonal slowdown going on at the moment, as we see a kinda sluggish movement from VLCCs coming out of USG. The Suezmax segment saw greater volume out of USG, or at least enough to keep levels steady. Across the Atlantic Suezmax Owners also experienced problems in WAF, however, it seems that solutions are getting worked out, and that solution thus far has been premium rates. In the MED, the market is largely dominated by the Aframax segment where we saw a nice mid-week increase but flattened out towards the end of the week. The North Sea was not very bullish this week as rates were trading at relatively low levels and the volume required to bring them up is not present.

CPP/PRODUCT:
The sky started to clear up this week as we had an LR segment with w-o-w increases, which to say the least, was required. Both the LR1 and LR2 segments are reporting green numbers, on TC1 (MEG/Japan) demand was on display, and WS has lifted almost 20 points this week. The LR1 likewise saw a nice increase on the MEG/Japan route with a 10 WS jump on TC5. For westbound voyages out of AG, the LR rates increase parallel with LR1’s now fixing at a high USD 2 mill and LR2’s at a low USD 3mill. The MR segment is trying to make a comeback but has only made failed attempts this far, unfortunately. China was on a long weekend which might have been part of the sluggish Asia market where rates were more or less flat. In the west, the market is changing focus to the USG where a bullish momentum has occurred, meaning that we will see ballasters from the Atlantic area heading there, which should be bullish news for the UKC where rates were mainly flat this week.

TIME CHARTER MARKET:
A lot of activity this week resulted in benchmarks moving all over the place (see data on Intel market data). ⌨ Once again we are seeing longer periods being fixed and negotiated and the reason could be the fact that sentiment is positive and charterers securing themselves against the volatility of the market. While charterers secure themselves, owners are benefitting from elevated rates and locking in the earnings
for the next 2-3 years. The demand drivers continue to be increased tonne-miles due to the Russian-Ukrainian war, increased dark fleet taking away availability, and relatively low order book, which will not supply affecting tonnage before late 2025 and 2026. The volatility is most likely going to continue throughout H2 2023 while trying to find a base which is being evidenced by the levels, we have seen throughout the last 2- 3 months. ⌨

SECOND-HAND MARKET:
Good activity this week with some interesting transactions! While some segments are setting new benchmarks, others are going back. The general market activity seems to be very much alive and active with vessels being negotiated across the board and more Sellers entering the game to cash out “while the game is fun”. It seems though that this is just the beginning of the fun for some others who continue to conclude and purchase vessels for further trading, seeing opportunities and possibilities rather than adversities. The common denominator of the buyers we are seeing is that almost all of them are expanding activities and operations where the lack of vessels and availability are pushing rates and prices upwards.

NEWBUILDING
Newbuildings seem to be in the spotlight and we continue to record new contracts suggesting that more owners believe in many years with attractive earnings! This week we recorded a series of tankers being contracted starting with Hyundai Mipo announcing having received an order for four firm 50,000 DWT MR2 Tankers from a private party. The vessels are scheduled for delivery during the second half of 2025 and are believed to be worth around $47-49m a piece. ⌨ Wuhu Shipyard announced orders received from Donsotank for two firm 22,500 DWT Chemical Tankers which are LNG Dual-fuel. The vessels are slated for delivery in 2025. Wuhu also announced having received an order for a pair of 18,500 DWT Chemical Tankers from a private buyer. The vessels are scheduled for delivery in H1 2026.

RECYCLING
Another dull week in the recycling market with low activity and stable prices. We are neither recording transactions nor hearing about negotiations going on in the tanker market which is to no one’s surprise with the current earnings and asset prices. The vessels that are even being slightly considered are very old smaller tankers ranging from 1-5k dwt and are built in the 70s and 80s. We are probably not going to see many tankers going to be recycled anytime soon which shifts focus to other segments in particular container vessels which are not having their best day after the monstrous earnings during the COVID-19 pandemic.

Servicing the maritime industry through technology, advanced intelligence and visionary shipbroking within multiple segments, specialized in asset trading, chartering, advisory services and capital markets.