Shipping companies are finding it hard to come to terms with large price hikes for new crude tankers, according to Braemar chief executive James Gundy.
Newbuilding contracting has been picking up this year, particularly in the product carrier space, but the cost of bigger vessels is proving a considerable barrier, the shipbroker told TradeWinds.
“We have seen a bit of a rally in the products/LR2 market,” Gundy said.
“We know yards are short of space. We are now seeing 2026 as being the window to take ships,” he added.
The CEO said Braemar has been involved in brokering newbuilding deals.
But he added: “It’s amazing where we were two or three years ago on prices and deliveries and where we are today.”
“The costs are increasing and of course, it’s hard for some owners to see where those prices were and where they are today. You’re buying suezmaxes for close to where VLCCs were,” Gundy said.
Brokers quote $121m for a new VLCC now, with suezmaxes at $81m.
MR tankers are being ordered for around $45m.
However, the CEO told TradeWinds that because of the stronger freight rate environment and the demand picture going forward, “there’s still a reason to build ships”.
MRs top the bill
MR tankers are proving popular in 2023, with Nissen Kaiun contracting eight 50,000-dwt ships at Hyundai Mipo Dockyard.
Jaldhi Overseas, Shoei Kisen, Evaland and Al Seer Marine have also been active in this sector.
Even the unfashionable LR1 clean tanker class has seen four ships added to the orderbook.
And George Economou’s TMS Tankers has inked a newbuilding contract for two 115,000-dwt LR2 tankers at New Times Shipbuilding in China, TradeWinds reported this week.
But crude tanker orders are a little thinner on the ground.
Economou’s Cardiff Marine has been signing deals for aframaxes, and Performance Shipping has ordered one.
Shipbuilding sources and brokers said Evalend has also commissioned Hyundai Samho Heavy Industries to build two scrubber-fitted 158,000-dwt suezmaxes to be delivered during the first half of 2025.
So far there have been no additions to the VLCC slate this year.
