Trump or Harris - Will it make a difference to shipping?

At a time that pollsters are almost all saying that their assessments of the upcoming US Presidential election is “too close to call”, a face-saving way of saying that they don’t know who will win, participants at shipping conferences try to steer conversations away from this subject.

At Capital Link’s 16^th Maritime Forum in New York moderator Anthony Renzi Jr., from law firm Vedder Price, was the exception, asking panelists on his “Ship Finance- Latest Trends and Developments” for their views on what might happen post November 5^th - the day of the elections.

Renzi framed the choices between ex-President Donald Trump- whose stated goals would be to increase oil and gas production in the States, and to impose additional tariffs on various imports into the States, and Kamala Harris, the Vice President in the current administration- who he described as more likely to keep the status-quo.

Panel member Robert Bugbee, President of Scorpio Tankers, voiced the view that, if the ex-President takes office again, “I don’t think that you are going to get all the things that Trump says that he’s going to do in regard to banning trade, etc…there’s a difference between ‘the Trump show’ and the Trump-what he’s actually going to do.”

Bugbee pointed out that many of Trump’s supporters are actually beneficiaries of cheap imports. In views echoed by the other panelists, he said: “Shipping tends to react more general world economy and general crises…than individual government [actions].”

Fellow panelist Ted Young, CFO/ Treasurer of Dorian LPG, said: “In our sector, during the last Trump administration, China imposed retaliatory tariffs on LPG imports, and it didn’t change anything…US cargoes went to Japan, Korea and other big importers.” He commented that commodity traders, and the big oil companies, “are pretty clever about re-balancing needs…regardless of what the political environment may be. I don’t expect massive changes.”

From the financial side, panelist Andrew Shohet, Head of Ocean Industries in the North American office of DNB Bank, voiced agreement, saying: “Ultimately, I don’t think that there is an efficient way to replace shipping.”  Talking about the legislative process, including a mention of the Inflation Reduction Act of 2022, which brought about tax credits and other incentives particularly for clean energy, he said: “Things have to get through Congress- it’s not like one person has the ability to switch something on our off.”

He agreed with the other viewpoints, saying: “I don’t think that there’s going to be too big of an impact” depending which party is in office.

Bugbee, in his remarks, also looked specifically at “difficult to handicap” impacts on tanker trades. “On the one hand,” he said, that with increased crude oil production under a Trump-led government, “you’d get more production, and longer voyages to the east towards China,” a positive for tanker ton-miles, However, he suggested that these trade flows would not comport with, and indeed be counteracted, by US efforts to persecute China (restricting trade).