Fearnley Offshore Supply (FOS) has published its latest keenly read monthly market report. FOS’s managing director, Tor Allen Widing, in penning the publication’s introduction, noted how the OSV sector was changing among the in-debt owners and a breed of new entrants.
“Going forward there will primarily be three categories of owners: the ones with some reduced debt, but with still overwhelming financial burdens; those which have been through Chapter 11 or other debt restructuring; and a category of new entry owners who have picked up their vessels at bargain prices and paid for them in cash,” Widing predicted.
The Fearnley executive went on to write that the OSV sector was still sullied by too much debt and too many ships, despite 150 OSVs being sent for scrap in 2018. Widing was disappointed to see some orders from the likes of COSL and Seatinel Marine filtering in over the past month or so.
Elsewhere in the report it was noted there was a clear bifurcation of vessel preference that emerged last year where more than 90% of supply vessels that were fixed on long-term charters were less than 15 years old.
“Combine that with the challenging average utilization overall and mostly yet-to-recover day rates, it became increasingly difficult to justify keeping older and low-spec tonnage through last year,” the FOS report stated.