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Tanker Shipping & Trade

Tanker Shipping & Trade

Growth in tanker values forecast for the next two years

Tue 21 May 2019 by Craig Jallal, tankers and markets editor

Growth in tanker values forecast for the next two years
VesselsValue: A positive forward value curve for tankers

VesselsValue has released its latest tanker value forecast, which is prepared in partnership with Norwegian consultancy ViaMar and shows quarterly predictions for individual vessels provided until the end of their predicted economic life.

The forward value forecast for tankers is set against a background of Q4 2018 which returned tighter markets across the tanker segments.

The report notes that Asia’s demand for oil continued at a strong pace through a combination of consumer demand, strategic storage requirements and planned start-up of new refineries.

China emerged, once again, as the greatest driver for demand and elsewhere the continuously evolving trading patterns caused by OPEC+ production cuts and Iran sanctions, as well as the ongoing decline in Venezuelan production and exports, boosted crude and product flows out of the US Gulf.

The tonne-mile intensive trade from the US to Asia, combined with typical winter seasonality, culminated in strong spot markets.

Values strengthened during Q4 2018 and into Q1 2019, though product tanker vessels have lagged behind the larger crude carriers.

According to VesselsValue/ViaMar, an asset value upside is still present during the projection period for both newbuild and secondhand tanker vessels.

On the supply side, scrapping activity has come down from its Q2 2018 high, but VesselsValue still recorded the busiest Q4 since 2013 and implementation of IMO 2020 is expected, through reduced speed and inefficiencies, to shave off supply capacity going forward.

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