A personal note of congratulations from Greek shipowner Peter Livanos was delivered to Hugo De Stoop soon after he was named as the new chief executive of Euronav in March this year.

De Stoop was deputy chief financial officer of Euronav back in 2005, when what was then an eight-tanker company merged with Livanos outfit Tanklog.

While Livanos is no longer a shareholder in the world’s largest public crude tanker owner, he retains a close relationship with the company in which the Saverys family remains a significant investor.

“It’s important to remember our roots,” De Stoop tells TradeWinds. “One of the benefits of a family firm, even when they are stock listed, is their values are very deep. More importantly, they always look at the long-term perspective rather than the short-term issues. That is also something we should remember in our sector.”

De Stoop became chief financial officer of Euronav in 2008, and he was set to officially succeed Paddy Rodgers as chief executive at yesterday's annual general meeting.

Sound partnership

While De Stoop says the straight-talking Rodgers was a good mentor, the 46-year-old insists the duo had an enjoyable partnership rather than a boss/subordinate relationship.

“Paddy was a fantastic partner and we have transformed and built this company together,” De Stoop says.

He adds that he is excited to take on a completely new challenge, having been at Euronav for 15 years and sat at the table as high-profile takeovers were signed.

Euronav’s first-quarter conference call last week stressed that there would be no change in the overall strategy following Rodgers’ departure.

“I don’t think the company requires many changes, but it needs to adapt to the present world — and the present world is changing very fast,” De Stoop says.

Some of the changes stem from the rapid growth of the past five years. The 2014 takeover of Maersk Tankers’ VLCC fleet and the 2018 merger with Gener8 Maritime, have been matched by a sharp increase in headcount.

Hugo de Stoop (right) was chief financial officer when Euronav listed in New York in 2015. Former Euronav chief executive Paddy Rodgers (centre) rings the bell during the event at the New York Stock Exchange, while major shareholder Marc Saverys (left) watches closely Photo: Euronav

“We need to make the necessary changes so the company continues to operate in a very efficient way,” De Stoop says.

“We are investing in new software and digital platforms to enable us to communicate and collaborate internally, to an extent that is required by the size of the company.”

With IMO 2020 only eight months away, De Stoop is taking over at a time when tanker rates are widely believed to be heading into an upward business cycle. Rodgers was an outspoken critic of scrubbers and many wondered if Euronav would retain its position on the controversial exhaust gas cleaning systems.

De Stoop says the thesis remains in place, but he challenges the belief that Euronav is simply a big company against scrubbers.

“What we have always said about scrubbers is the risk/rewards are not really attractive, and we prefer to wait and see if the spread will stabilise next year,” De Stoop says.

“The initial period is expected to be chaotic and volatile. But, at some point, it will stabilise and it will be interesting to see how fast and at what level. If we see it stabilise at a big spread, then we can still take the decision to install scrubbers.”

Tip of the iceberg

While Euronav’s present position on IMO 2020 differs among public VLCC owners, De Stoop says he does not feel exposed.

“I think it’s a lot more attractive and maybe a few more people can have that strategy other than Euronav,” he says.

De Stoop explains IMO 2020 deserves its own strategy, but he describes the new emissions laws as the tip of the iceberg in terms of future environmental challenges.

He says Euronav will stick with its simple and disciplined method of looking to acquire assets at the bottom of the cycle as a consolidator, while having a balance sheet capable of withstanding unexpected downturns.

“But, of course, we also have a lot of challenges coming from the regulatory side,” he adds. “In the longer term, we are thinking about CO2 footprint reduction.”

De Stoop explains that shipping is not an isolated industry and if it manages to reach the CO2 reduction requirements of the Paris Agreement on climate change, there will also be a drop in demand for fossil fuels carried by sea.

“It is important not to ignore it and pretend it’s not happening,” he says. “Arguably, for a company like Euronav, it’s very exciting, as when you are facing those very big challenges, usually the big players benefit from it and find the opportunities the smaller players can’t.”