Charlie Grey has taken the chief executive reins at large, long-running VLCC player Tankers International (TI) and plans to focus on growing the 64-strong vessel pool.
Grey, who joined TI almost two years ago as chief operating officer, stepped into the hot seat on 3 April in a planned succession.
- Established: 2000
- VLCC pool (end April 2023): 64 vessels
- Average age: 7.9 years
- Owners: 8
- Sub-pools: 3 — modern scrubber fitted ships; modern non-scrubber fitted ships; and vessels aged 15 years and older
- Employees: 22
- Offices: London (HQ) — 3 chartering staff; New York — 2 chartering staff; and Singapore
He takes over from long-serving chief Jonathan Lee, who becomes chairman of TI’s board of directors.
TI chartering executive Matt Smith steps into the COO role.
Speaking to TradeWinds after his first few weeks in the job, Grey was positively bursting with enthusiasm.
TI has doubled the size of its scrubber-fitted sub-pool, boosting its numbers from 17 VLCCs at the start of 2022 to 34 ships today.
Grey said the majority of these are from new owners joining the pool, plus a few retrofits.
TI has set a target to have 10% of the global VLCC fleet of around 870 vessels. “So we’re not far off,” Grey said.
“If we got up to 100, we’d keep going. I see the positives in it,” he added, hinting that a couple more vessels will be added soon.
Grey said TI — in which Euronav and International Seaways are key stakeholders — works independently. He declined to comment on the future of Euronav, whose recently planned but now canned merger with one-time TI player Frontline would have added almost 100 ships to the pool.
“We will continue to have a dialogue with big owners with big fleets. There are obvious natural synergies,” both for the pool and the market, he said.
“As a founding member over 23 years ago, we have sought the best stewardship for the leading VLCC pool. I am confident that under his leadership, along with the support of the management team, Charlie can deliver exceptional value and competitive financial returns for all pool partners.”
Grey said TI’s focus in the last 12 to 18 months has been on smaller tanker owners and operators — those with fewer than 10 vessels — who are more exposed to the timing of when they fix the ship.
The company has also seen more owners from the Far East joining the pool.
He said TI’s scale, experience and data analytics allow the pool to put the “right ship into the right fixture”, optimising earnings for owners and helping impact the terms and conditions of voyages. It is also effectively offering these players outsourced research, analyst and commercial departments.
“I'm confident that even in the near-term future we will continue to grow,” he said.
Grey said TI has made fundamental changes to the pool — companies now only need to commit their vessels to a six rather than a 12-month period — to give owners flexibility in a changing industry.
The new CEO described how the Russia-Ukraine crisis has created a more fragmented VLCC market. He said the sector lost tonne-miles as long-haul trades from the US Gulf to China vanished and were replaced with transatlantic or West Africa to Europe business.
Now the long-haul voyages have resumed with the resurgence of China, but the shorter trades remain, making volumes more diverse and giving another dimension to business.
“Since he was appointed as COO, Charlie excelled at meeting the needs of pool partners while navigating the uncertain trends driving the VLCC market.”
This leads Grey to be “very positive” about the VLCC market for the next few years. But the low orderbook, lack of new orders and fleet age profile are the biggest concerns, with the underutilisation of older ships shrinking the market further. Decarbonisation will also need to be a focus for the sector.
He believes the TI pool’s volume of ships will help owners protect their vessels’ carbon intensity indicator ratings as ships can be better matched to voyages.
“I can’t think of a better place to be than in a pool right now when it comes to the changes that we have on our horizon,” he said.
The secret of TI’s longevity?
“It’s the transparency and the relationship it has with its owners,” Grey said, while acknowledging that earnings must also be strong. “The pool becomes a forum where owners express their concerns but also share expertise. “It is about making people feel that they’re part of a family.”
He said TI’s recent experience debunks the myth that pools only flourish in bad markets with the majority of new pool tonnage being added in the second half of 2022 when the VLCC market was starting to take off.
“I believe that we have built something incredible at Tankers International, and I’m very proud to have played my part in building an evolutionary new model for tanker pooling. Since Charlie joined, it has been clear to me that he is the optimal choice to lead Tankers International as it continues to grow and evolve.
Grey has his hands full.
Aside from pool expansion, TI has just relocated to new offices in south-west London and the company is working hard on developing its information-packed TI fixtures app — now attracting 1,600 unique users per week and proving an increasingly important source of earnings — and the data side of the business.
Grey also plans to add quarterly earnings calls and more technical meetings.
Looking further out he wonders if the pool could operate in other tanker segments and grow bases in centres such as Houston and Dubai.
