Poten & Partners: Large Tanker Orderbook Not as Scary as It Looks

Image Courtesy: Bahri

Based on the delivery schedule of the current orderbook, deliveries of new tankers in 2017 will reach the highest level since 2009, however, Poten & Partners argues that the orderbook may not be as scary as it looks.

While, it is difficult to see how the market can absorb such a large orderbook without further pressure on tanker rates and prices, there may be some mitigating factors to consider.

The Suezmaxes stand out on the crude tanker side, and if all Suezmaxes that are scheduled for delivery this year leave the shipyards on time, a total of 10.1 million dwt would be added to the fleet, well above the 2009 record of 7.1 million dwt, and two and a half times total 2016 deliveries.

The recent high-water mark for VLCCs was 2011, when 65 new units of 20.1 million dwt hit the water. This year, the yards are scheduled to deliver 15.9 million dwt, while Aframax and LR2 deliveries in this year would reach 9.4 million dwt in total. Deliveries for the Panamax/LR1 segment are expected to stand at 2.4 million dwt in 2017.

In the smaller product carrier segments, the orderbook for delivery in 2017 is more moderate, compared to earlier years.

A total of 77 MRs are scheduled to join the fleet in 2017, while the Handysize vessels seems to have fallen out of favor as only 18 are expected to be delivered during the year.

However, the main mitigating factor when considering the above fleet statistics is that there can be significant discrepancies between scheduled and actual deliveries, especially in periods with a challenging rate environment.

“Delivery delays and order cancellations picked up considerably after the tanker market dropped in 2009,” Poten & Partners said, adding that VLCCs have the highest average delivery ratio of 80%, ranging from a high of 100% in 2006/2008 to a low of 53% in 2013.

Product carrier orderbook statistics appear less reliable and these tankers a low average delivery ratio of around 50%. Even during the strong freight markets of 2005-2008, only 65% of the vessels that were reportedly on order were delivered.

“Based on the historical variability of vessel deliveries and its apparent correlation with the freight market, 25-40% of the crude oil tanker orderbook and up to 50% of the product carriers scheduled for 2017 might not be delivered this year. The orderbook remains high, but the outlook for tanker supply in 2017 is better than a cursory look suggests,” Poten & Partners informed.

Share this article

Follow World Maritime News

In Depth>

Events>

<< May 2017 >>
MTWTFSS
1 2 3 4 5 6 7
8 9 10 11 12 13 14
15 16 17 18 19 20 21
22 23 24 25 26 27 28
29 30 31 1 2 3 4

CWC World LNG & Gas Series: Americas Summit

Now in its 15th year, the CWC World LNG & Gas Series: Americas Summit is the longest running LNG event in the Americas region.

Bringing together the key players in the LNG & gas value chain in both the Americas region and globally, this is the perfect place to make new contacts, do deals and get essential updates on the market.

This year we return to Houston, TX once again on 20-23 June 2017 – the heart of the energy industry, making it easier than ever to access they key players in your business.

More info

read more >

Nor-Shipping 2017

Nor-Shipping is the leading maritime event week. Their top-quality exhibition, high-level conferences and prime networking opportunities…

read more >

2ND ANNUAL PORTS AND TERMINALS INSURANCE SEMINAR

DETAILED GUIDANCE ON HOW THE INSURANCE MARKET IS CHANGING, HOW RISKS ARE ASSESSED AND WHAT…

read more >

2ND ANNUAL ADVANCED CHARTERING MASTERCLASS

The Advanced Chartering Masterclass will focus on the particularly difficult issues in charterparty agreements and our experts will help you find solutions…

read more >