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Floating storage market came off quicker than expected: EuronavFloating storage market came off quicker than expected: Euronav

Large tanker owner Euronav say the boom in the floating storage market has come off quicker than expected.

Marcus Hand, Editor

August 6, 2020

1 Min Read
Tanker Ann Euronav from above
Euronav VLCC Anne on sea trialsPhoto: Euronav

In Euronav’s second quarter results statement ceo Hugo de Stoop said: “Floating storage requirements dissipated sooner than expected, pivoting the tanker market to a transition phase ahead of our prior forecast.”

Euronav noted that a disconnect between oil production and demand which had driven floating storage and forecasts of its continued demand was not susutained, “as OPEC+ cuts enacted on May 1 were accompanied by further additional voluntary Saudi based reductions and production shut-ins from the US shale sector.”

As a result peak demand for floating storage was around 275m barrels compared to forecasts in Q2 of three times that amount.

“A specific feature of the floating storage impact on tanker markets was, in the short term, the disproportionate quantities that the suezmax/aframax vessels took in floating storage primarily due to the freight rate differential with VLCC vessels. Therefore, when the unwind of this floating storage occurs, it may be less pronounced on VLCC sector,” Euronav said. It said that only around 40 – 50m tonnes of VLCC capacity was taken on for floating storage on shorter contracts.

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About the Author

Marcus Hand

Editor

Marcus Hand is the editor of Seatrade Maritime News and a dedicated maritime journalist with over two decades of experience covering the shipping industry in Asia.

Marcus is also an experienced industry commentator and has chaired many conferences and round tables. Before joining Seatrade at the beginning of 2010, Marcus worked for the shipping industry journal Lloyd's List for a decade and before that the Singapore Business Times covering shipping and aviation.

In November 2022, Marcus was announced as a member of the Board of Advisors to the Singapore Journal of Maritime Talent and Technology (SJMTT) to help bring together thought leadership around the key areas of talent and technology.

Marcus is the founder of the Seatrade Maritime Podcast that delivers commentary, opinions and conversations on shipping's most important topics.

Conferences & Webinars

Marcus Hand regularly moderates at international maritime events. Below you’ll find a list of selected past conferences and webinars.

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