Indian owners are anxiously awaiting the outcome of the first offshore support vessel tenders issued since the sector was hit by the oil price crash and the coronavirus pandemic.
The market in the subcontinent has been insulated to a large extent by contract cover, unlike the North Sea sector, which has been enduring horrendous spot rates since March.
Speaking on a conference call with analysts, Great Eastern Shipping chief financial officer G Shivakumar said the company had enjoyed a "reasonable level" of employment in 2019.
"We were quite optimistic on the prospects for the market in early 2020," he added.
"And the market looked like it was turning around, it was getting a little bit of strength, utilisation of the global fleet was going up."
But the oil price crash led to oil companies cutting exploration and production budgets, he added.
The CFO put this at between 20% and 30% for India this year.
"It will probably reflect in their requirement for assets," Shivakumar said.
"Let's see how it turns out if oil goes back to, say, $50, $55 per barrel. You could see some of this coming back and some more confidence coming back among the oil producers and maybe demand coming back again."
Pricing awaited
Shivakumar said he had not seen any new pricing in the Indian market since its lockdown began in March.
"So we don't know how pricing has changed with this lockdown. We will come to know when there are new pricings. We have had tenders which have been bid, but we haven't seen anything closed yet," he added.
"We have six vessels which need to be repriced during the course of this year, out of our 19 vessels. We have one vessel which is completing a dry-docking in Singapore."
Its ships are fixed at varying rates, which he said may not be "that great", but at least there are contracts in place.
Operating days
"We have bid some of [the six] into tenders and we'll get to know as we go along what kind of rates we are able to get and whether we're able to get employment at all," he said.
Great Eastern has about 80% of OSV operating days locked in for 2020.
The offshore ship backlog is INR 5.89bn ($78m), with platform supply vessels having 94% of days booked.
The first quarter group loss was INR 506.8m in the three months to 31 March, compared with a profit of INR 1.48bn a year ago.
Revenue grew to INR 10.5bn from INR 10.2bn, but bunker costs rose and the company was hit by a change in the value of derivatives.
