Global Maritime Hub Logo
No Result
View All Result
  • Login
  • Premium Content
  • Blog
  • Events
  • Industry Links
    • Broker
    • Certification
    • Consultant
    • Industry Association
    • Institute & Think Tank
    • Legal Experts
    • Official Institution / Body
    • Port & Port Authority
    • Recruitment Specialist
    • Research & Market Data
    • Shipping Company
    • Industry Blog
    • Trade Media
    • Training & Education
  • Other Hubs
    • GLOBAL LNG HUB
    • EUROPEAN GAS HUB
    • THE COAL HUB
    • GLOBAL HYDROGEN HUB
    • CRITICAL MINERALS HUB
  • FREE TRIAL
  • My account
  • Login
Cart / €0.00

No products in the cart.

  • Premium Content
  • Blog
  • Events
  • Industry Links
    • Broker
    • Certification
    • Consultant
    • Industry Association
    • Institute & Think Tank
    • Legal Experts
    • Official Institution / Body
    • Port & Port Authority
    • Recruitment Specialist
    • Research & Market Data
    • Shipping Company
    • Industry Blog
    • Trade Media
    • Training & Education
  • Other Hubs
    • GLOBAL LNG HUB
    • EUROPEAN GAS HUB
    • THE COAL HUB
    • GLOBAL HYDROGEN HUB
    • CRITICAL MINERALS HUB
  • FREE TRIAL
  • My account
  • Login
Global Maritime Hub
No Result
View All Result
Home Shipping Trends

VLCC’s Holding Steady

Editor by Editor
7 years ago
Reading Time: 2 mins read
Share on FacebookShare on TwitterShare on Linkedin

Source: GIBSONS

RELATED POSTS

Charter-market

Charter market maintains robust trajectory

20 hours ago
alliance-fleets

Carriers assign up to 80%of their capacity to alliance fleets

20 hours ago
methanol-enabled-AXEL-MAERSK

The 16,592 TEU methanol-enabled AXEL MAERSK was recently delivered to Maersk, completing a first series of twelve Equinox-I type mainline container ships!

1 week ago

Much attention has been given in recent months to continued activity in newbuild VLCC tonnage. Shipbrokers Gibson’s, are not an exception to that, warning repeatedly about the risk of over-ordering if investment in VLCCs continues at such a relentless pace. However, what has gone largely unreported is the fact that the pattern of ordering activity has been completely different in other tanker segments, starting from Suezmaxes down to MRs. Most notably, investment in new tonnage has been minimal in the LR1/Panamax size group.

Just 4 tankers have been ordered so far in 2018, while ordering was also highly limited over the previous two years. Without doubt, a lack of investment interest has been driven by poor performance. In recent years, LR1s have also faced an additional challenge in terms of the increased competition from both smaller and larger product carriers, frequently reporting lower earnings compared to other sizes.

Not surprisingly, owners have showed preference for smaller MRs or bigger LR2s when ordering a new tanker. With the exception of Handy tankers, as of now LR1/Panamaxes have the smallest orderbook, at 7% relative to its existing fleet. The orderbook for Suezmaxes is also becoming notably smaller. Only 2 firm tanker orders (plus 4 shuttle tankers) have been placed this year to date, while investment in new tonnage was also somewhat restricted in 2016 and 2017. As a result, the Suezmax orderbook has now fallen below 9% relative to its existing size, nearly three times smaller from its position two years ago.

The MR orderbook (40,000 to 55,000 dwt) stands close to 10%. Investment in new tonnage so far this year has been rather modest, with just 26 confirmed orders; yet,
last year over 70 new tanker orders were placed. It is also worth pointing out that the orderbook for Handy tankers (25,000 to 40,000 dwt) is almost non-existent, with just 3
tankers yet to be delivered. However, this is largely a reflection of owners’ preference for the larger MR size when ordering new tonnage.

Finally, LR2/Aframaxes have the second largest orderbook of all size groups, largely as a result of robust investment in 2017. Yet, investment has slowed once again this year, with 12 confirmed orders for the year to date. As such, the orderbook remains notably below that of VLCCs. Just under 12% of the LR2/Aframax fleet is on order versus 16% in the VLCC segment.

The above developments indicate that the growth in fleet size for most size groups could slow down notably next year, particularly if the demolition market remains active. Scheduled deliveries for Suezmaxes, LR2/Aframaxes and LR1/Panamaxes are expected to fall in 2019 to their lowest level since 2015. The number of scheduled deliveries in the MR segment in 2019 is on par with levels this year, yet still notably below the number of new deliveries seen between 2014 and 2016.

This paints a much healthier picture in terms of fleet growth going forward. However, in order to see a much-needed rebound in tanker earnings, the current trend of robust ordering in the VLCC segment should certainly not be repeated in other tanker classes.


RELATED POSTS

Charter-market

Charter market maintains robust trajectory

20 hours ago
alliance-fleets

Carriers assign up to 80%of their capacity to alliance fleets

20 hours ago
methanol-enabled-AXEL-MAERSK

The 16,592 TEU methanol-enabled AXEL MAERSK was recently delivered to Maersk, completing a first series of twelve Equinox-I type mainline container ships!

1 week ago
Tags: AframaxGibsonGibsonsHandy tankerspanamaxSuezmaxVLCC
Editor

Editor

Related Posts

Charter-market
Shipping Trends

Charter market maintains robust trajectory

20 hours ago
alliance-fleets
Shipping Trends

Carriers assign up to 80%of their capacity to alliance fleets

20 hours ago
methanol-enabled-AXEL-MAERSK
Shipping Trends

The 16,592 TEU methanol-enabled AXEL MAERSK was recently delivered to Maersk, completing a first series of twelve Equinox-I type mainline container ships!

1 week ago
'large-cap'-valuation
Shipping Trends

Six public container carriers hit ‘large-cap’ valuation in May

1 week ago
US-volumes-test- tonnage-supply
Shipping Trends

US volumes test tonnage supply, uncertainty looms

1 week ago
Panama-Canal
Shipping Trends

Neo Sub-Panamax Container Ships cross the Panama Canal in record numbers

2 weeks ago

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

No Result
View All Result

Trending Posts

Hapag-Lloyd

Hapag Lloyd crosses the 2.4 MTeu milestone

May 22, 2025
liner-trade

Europe-Far East remains by far the largest liner trade!

June 5, 2025
ULCS

First ULCS to reach 20 years in fleet of ‘jumbo pioneer’ Maersk

May 22, 2025

Recent Post

Charter-market

Charter market maintains robust trajectory

June 19, 2025
alliance-fleets

Carriers assign up to 80%of their capacity to alliance fleets

June 19, 2025
MABUX-Index-W-25

Bunker fuel outlook, Week 25

June 19, 2025
Global-Maritime-Hub- Logo

Online platform for sharing information & analysis on trade, shipping, ports and the maritime business more info

Categories

  • Shipping Economic Trends & Regions
  • Ports & Terminals
  • Piracy & Security
  • Emissions, Fuel Technology & Environment
  • Economic Impact
  • Financing
  • Ship Building
  • Hinterland & Intermodal
  • Offshore Vessels
  • Port Environmental Impact
  • Shipping Workforce

Recent Posts

Charter market maintains robust trajectory

Carriers assign up to 80%of their capacity to alliance fleets

Bunker fuel outlook, Week 25

Weekly Updates

Sign up to receive our weekly newsletter (each Thursday) with new shipping industry market reports, presentations & analysis.

Your subscription could not be saved. Please try again.
Your subscription has been successful.

By signing up, I agree to our TOS and Privacy Policy.

© 2020 GlobalMaritimeHub | All Rights Reserved

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
No Result
View All Result
  • Premium Content
  • Blog
  • Events
  • Industry Links
    • Broker
    • Certification
    • Consultant
    • Industry Association
    • Institute & Think Tank
    • Legal Experts
    • Official Institution / Body
    • Port & Port Authority
    • Recruitment Specialist
    • Research & Market Data
    • Shipping Company
    • Industry Blog
    • Trade Media
    • Training & Education
  • Other Hubs
    • GLOBAL LNG HUB
    • EUROPEAN GAS HUB
    • THE COAL HUB
    • GLOBAL HYDROGEN HUB
    • CRITICAL MINERALS HUB
  • FREE TRIAL
  • My account
  • Login

© 2020 GlobalMaritimeHub | All Rights Reserved

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.

Brighten Up Your Thursday!

SIGN UP to receive our free weekly newsletter with new shipping market reports, presentations & analysis! EVERY THURSDAY!