Oil tanker market "holds its breath" to watch year-end fluctuations

Donald Trump's re-election as the 47th President of the United States has had a strong impact on the energy and shipping markets, which are already very sensitive to political and economic fluctuations domestically and internationally.

Boat rental prices "cool down"

According to the leader of Pacific Petroleum Transportation Joint Stock Company (PV Trans Pacific), after a period of "heating up", the oil tanker transportation market is showing signs of "cooling down". Freight rates, ship rental prices and ship purchase and sale prices are all decreasing compared to the peak period about half a year ago.

The shipping price of oil tankers in all ship size segments is currently on a downward trend.

Prices are reduced across ship size segments, from VLCC (super heavy crude oil tanker from 150,000 to 320,000 DWT), Aframax (ship with a capacity of 80,000 to 120,000 DWT), MR (medium-sized oil tanker with a capacity of 40,000 - 50,000 DWT)... with a reduction of 10-20% depending on the segment.

Typically, VLCC ships currently cost around 40,000 - 42,000 USD/day, while previously it cost around 50,000 USD/day. Aframax size ships previously cost around 38,000 - 39,000 USD/day, but now the price has dropped to around 32,000 - 33,000 USD/day.

For MR size vessels, the current price is around 17,000 - 18,000 USD/day, while the peak price is around 27,000 - 28,000 USD/day.

Geopolitical tensions in the Middle East have increased the risk to oil prices and potentially freight rates, with signs of bottoming out for VLCCs, according to data from shipbroker Fearnleys.

Still, the tanker sector remains busy with new building orders, according to shipping brokers, with analysts at maritime research firm Clarksons Securities predicting that lower demand and global financial pressures from late 2024 will see tanker freight rates gradually fall.

Unpredictable market

According to Hellenic Shipping News, the election of Donald Trump as President of the United States could bring about significant changes in the tanker shipping market, which has seen many structural changes since the Covid-19 pandemic.

With Donald Trump becoming the 47th President of the United States, the energy and shipping markets are frantically calculating the impact on corporate business plans, shipbroker Gibson said in a new report.

For tanker shipping, the new president’s support for the US oil industry could complicate the picture. Whether freight rates rise or fall depends on the policies that are put in place.

According to Gibson, one of Trump’s boldest campaign statements was that he would end the war in Ukraine. How he would do that and what it would mean for the tanker market is uncertain. However, several scenarios are possible and potentially extreme.

It can be said that the oil tanker block is "holding its breath" to monitor the market situation. Many experts predict that with the views of US President Donald Trump on the energy market and the views related to the political situation between Russia and Ukraine, demand is expected to decline. The market is expected to take a clearer shape in 6 months - 1 year when new policies can be introduced.

According to a shipping expert, the oil tanker market is always the most sensitive in the shipping sector. The effects of geopolitical situations and policies of major countries always have a strong impact on oil tanker transportation worldwide , including Vietnam.

However, in the context of the still positive oil tanker market, some businesses have been planning to invest in new fleets.

Typically, at the end of October, PetroVietnam Transportation Corporation (PVTrans) received the MR - PVT Valencia product oil tanker with a capacity of 47,399 DWT, increasing the PVTrans fleet to 58 ships, with a total capacity of about 1.7 million DWT.

PV Trans Pacific has also just added to its fleet the 50,697 DWT chemical tanker Pacific Pride. The investment helps increase the total number of ships owned by PV Trans Pacific to 4 with a total tonnage of over 300,000 DWT and diverse types such as Aframax, MR, FSO...

Recently, Vietnam Shipping Joint Stock Company (Vosco) also planned to invest in 10 new oil tankers, especially product tankers. The company planned to invest in newly built ships with the expectation of early delivery to take advantage of the good market period.

Specifically, Vosco plans to invest in purchasing two used Supramax bulk carriers, with a capacity of 56,000 - 58,000 DWT, under 15 years old, with a maximum purchase price of 23 million USD/ship.

At the same time, investing in building 4 new Ultramax-sized ships, with a capacity of 62,000 - 66,000 DWT, built in Japan/Korea/China/Vietnam at a cost of less than 40 million USD/ship. The company also plans to build 4 new MR-sized product oil tankers, with a capacity of about 50,000 DWT at a cost of less than 52 million USD/ship. The investment capital comes from the company's loans and equity capital, with the ratio depending on each project.

Source: https://www.baogiaothong.vn/thi-truong-tau-dau-nin-tho-doi-theo-bien-dong-cuoi-nam-192241122185514164.htm