Fredriksen's flagship tanker company reported a third quarter net loss of $24.1m which it blamed on weak tanker spot rates and a $5.8m loss from the termination of charter for the suezmax tanker Front Ardenne.
The low spot rates were a result of the aggressive fleet growth seen in the tanker sector. "The impact of the significant fleet growth over the last two years was felt across the industry and is reflected in our results for the third quarter. Indeed, the rate environment presented in the quarter was the weakest we have experienced since 2013,” said Robert Hvide Macleod, ceo of Frontline.
Spot VLCC rates for Q3 averaged just $13,200 per day compared to $23,600 in Q2. However some improvement was seen for Q4 with an estimated $19,200 daily.
Looking ahead the tanker owner sees upside from the current market lows.
“Frontline has a positive long-term view of the market . We believe we are at the bottom of the cycle, and this is reflected in rates and asset prices. There will surely be challenges as well as opportunities, and we will continue to execute our strategy of fleet growth and renewal,” the company said.