Tankers could face a rough voyage through 2025Tankers could face a rough voyage through 2025

Tanker owners have benefited recently from ‘colossal gains’ in tonne-miles following sanctions on Russia and longer voyages round the Cape, shipbroker Gibson has pointed out. Other plus points have included the exit of older vessels into the grey fleet, and minimal deliveries.

But some of these factors are likely to change over the year ahead, Gibson predicts. Although the rate of new  deliveries will vary across ship sectors, more than 70 new medium range vessels are due for delivery over the year, for example, double this year’s number and the highest figure since 2019. Figures for LR2/Aframaxes and Suezmaxes are also notable: about 55 tankers in the first category will join the fleet, the highest number since 2017, and 30 new vessels in the second category will join the fleet.

Deliveries across other segments are still limited, however. There are only 15 new ships due for delivery  across the VLCC, LR1/Panamax and Handy segments. Meanwhile, a significant number of vessels will turn 15 years of age during the year, Gibson noted.

Demand patterns will change too, although the fortunes of larger LRs will be intertwined with the state of the crude tanker market. Some of the new LRs could well trade clean, at least at the outset. Meanwhile Dangote, the $19 billion refinery in Nigeria and one of the largest in the world, will slash the country’s import requirement for products, and Mexico’s Olmeca refinery will also affect the clean market by cutting imports there.

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Offsetting this to some extent could be modest increases in Middle East refinery runs, the shipbroker said, which could reach full capacity during the year. And although European demand is relatively soft at present, plant closures across the region will reduce capacity and could generate more import demand. All of this offers an element of support to the clean tanker market, but perhaps not large enough to offset the negative impact of dirty-to-clear switching and the reduction in products imports to West Africa and Mexico.

A somewhat brighter picture is evident in the dirty trades with higher crude production in the Americas generating incremental tonne-mile demand. Gibson referred to the International Energy Agency’s latest monthly report which predicts that higher production in the US, Canada, Brazil, Guyana and Argentina could total 1.2 million barrels a day in 2025. This could offset the reduced flow of crude from Nigeria and Mexico and could support more trans-Pacific trade to Asia.

Meanwhile, uncertainty surrounds the OPEC+ production strategy. Voluntary production cuts have been extended into 2025 but tankers will benefit if/when they are unwound. Trump 2.0 could also change the backdrop and an escalation of the Middle East conflict could potentially threaten oil supplies from there. However, stricter Iranian sanctions could be positive, Gibson said, particularly for larger crude tankers, shifting demand from the dark fleet to mainstream trades.

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