The tanker market is set for a strong period of sustained growth not seen for 15 years, according to Bimco.
Crude and product tanker demand will outstrip supply in 2023 and 2024, driven by expected growth from China and rising demand for jet fuel as the world’s largest importer of oil opens for global travel after the pandemic.
The US Energy Information Administration predicts that China will account for 38% of the growth in oil demand between 2022 and 2024, with India accounting for 18%.
Bimco chief shipping analyst Niels Rasmussen said it would take “quite a few unpredicted changes” to undermine the predicted strength of the market.
“We believe in fact that the market will experience a period of sustained market strength that has not been seen since the 2008 financial crisis,” he said in a quarterly outlook.
The shipowner body forecasts suggest that crude tanker demand in 2024 will increase by up to 6.5% compared with 2022 levels, while product tankers will rise by up to 8%.
It predicted increases for freight and time charter rates as well as secondhand ship prices.
A key factor for the optimistic outlook is likely increased hauls owing to the reshuffle of trades prompted by Russia’s invasion of Ukraine.
Bimco said average sailing distances are likely to increase by 3% to 4% because of the European Union’s ban on Russian seaborne oil imports. Russian dirty tanker export tonne-miles have more than doubled compared with a year ago, it said.
Environmental factors are likely to reduce sailing speeds by 2% to 3%, it added. Combined with the low orderbook, tonnage supply is likely to fall.
“Should either of these shifts in trade and operational patterns not materialise as predicted, the market will not strengthen as per our forecast,” Rasmussen said.
