Hong Kong: One of the many findings of Simpson Spence and Young's latest World Oil Tanker Trends is that Vladimir Putin's decision where to lay pipelines from Siberia will have a key bearing on tanker owners' bottom lines.
For this edition, priced US$745, SSY has expanded its coverage of the renewable energy and chemical tanker markets. the broker leads the report on the burgeoning bio-fuel sector and its potential impact on the tanker sector. The report also reviews the LNG and LPG markets of 2006 and outlines expected market conditions for the next few years. While cargo supply and demand is on the rise, as with the tanker sector, record fleet growth awaits in 2007 and 2008.
Seatrade Asia Online caught up with up with Louisa Follis, one of the researchers behind the study and asked her about the perceived threat of overcapacity. "The risk of overcapacity is a matter of whether you are looking at the tanker markets from the view of a ship owner or charterer," she says. "For the last four years the relatively tight tanker markets have produced very firm rate levels - ie in owners' favour."
"A widely expected growth in the tanker fleet is likely to exert some downside pressure on spot tanker frieght rates as tanker demand growth is unlikely to match this pace," she continues. 'Therefore shipowners will view this as 'overcapacity' but charterers are more likely to view this as more of a 'market balance' - ie more choice of tonange and possibly lower rates."
One key consideration for tanker owners is the many projected pipelines that are likely to flow into China in coming years. "If these projects are fully fulfilled," says Follis, "then there could be up 2mb/d moving overland into China, which would then limit crude tanker demand growth to some extent beyond 2012."
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