Analyst Noah Parquette has also upgraded his rating on leading owners DHT Holdings and Scorpio Tankers on the eve of the second quarter results season.
In a report today Parquette explained the fact the tanker market has politely ignored seasonality and shown no real weakness at the start of the third has led him to believe the “tanker cycle has legs”.
Admitting previous forecasts have been too conservative, the analyst hiked his 2015 VLCC projection by $2,660 per day to $57,622 per day.
His 2016 expectation has been bumped up by $2,000 per day to $50,000 daily, the report showed.
While his suezmax forecasts were also revised upwards, the largest change saw JP Morgan raise its 2015 aframax rate view to $41,064 per day. This marks a hike of over $7,000 per day on its earlier projection.
In the same report, Parquette boosted his rating on DHT Holdings from neutral to overweight, stressing the under performance of its stock is unwarranted.
JP Morgan’s numbers have DHT heading for a profit of $92m this year and $84m in 2016.
Products promise
Parquette has also strengthened his products tanker expectations, noting the market has had no trouble absorbing 5% fleet growth.
He now projects LR1 tankers to make $27,355 per day this year, with MRs bringing in $22,124 per day.
Scorpio, the world’s largest products tanker owner, has raised from neutral to overweight having taken delivery of most of the tankers ordered in 2012.
JP Morgan expects Scorpio to record a profit of $254m this year and $213m in 2016.
