Having slumped to generational lows, the tanker orderbook is finally building up, but analysts remain convinced the sector is still poised to enjoy a lengthy earnings bonanza.
Tanker newbuilding orders have risen by 250% year-on-year from 24 in the first four months of 2022, to 85 so far in 2023, according to data from VesselsValue. Aframaxes/LR2s account for the majority of orders at 39%, followed by suezmaxes at 30%.
Despite these orders, analysts at Xclusiv Shipbrokers maintain that the global tanker fleet is in danger of shrinking in the near future mainly because of the low orderbook, which stood at its lowest point since 1996 in February this year and because about 34% of the active fleet is older than 16 years.
Within the next 32 months Xclusiv forecasts the active fleet will grow only by 1%, as 348 newbuilding vessels will enter the total tanker fleet and 270 vessels will go for scrap based on an average of 90 vessels per year based on yearly data since 2003.
Joakim Hannisdahl-led Gersemi Asset Management sees slightly greater fleet growth, but still minimal, estimating the tanker fleet will grow 2.5% this year, just 0.7% next year and 2.4% in 2025.
Looking at the supply/demand fundamentals broker BRS argued in its latest weekly tanker report that the sector remains on the “cusp of a golden age”, which could last for a long time considering delivery lead times could persist until 2027. Orders for LNG carriers and containerships have rammed Asian shipyards, with many of the largest, best-known shipbuilders having orderbooks stretching through for the next 3.5 years.
