Vessels are being laid up more quickly now in the North Sea offshore shipping sector than at any point in the last crash in 2014.
Norway's Seabrokers said the slowdown has slashed rates and torn up any previous forecasts as the industry was hit by coronavirus restrictions at the same time as the oil price plunged to historic lows.
"The slowdown in the North Sea spot market has been more dramatic over the last four to six weeks than any of us could have imagined," the broker added.
"It was inevitable that there would be a reduction in offshore activity this year and that any previous forecasts for vessel demand could be thrown out of the window."
Seabrokers said the lack of spot requirements in recent weeks will have shocked even the most pessimistic of owners.
"At no point during the previous downturn did we experience anywhere near as many vessels being laid up in such a short time frame," the company said.
Rush to lay up ships
At least 30 offshore support vessels (OSVs) have been stacked in North Sea ports since mid-March, the broker estimates.
The list consists almost entirely of platform supply vessels (PSVs) apart from a pair of Dof anchor-handling tug supply (AHTS) ships.
Owners involved include Bourbon, Golden Energy Offshore Services, Havila Shipping, Hermitage and Island Offshore.
Ships owned by Hoyland, Simon Mokster, Olympic Shipping, Tidewater and Sverre Farstad have also been laid up.
Other operators, such as Fletcher Shipping, have brought PSVs in-house temporarily until trading conditions improve.
Rates scrape along the bottom
Even this has not been enough to stop spot earnings for PSVs hitting £3,000 ($3,700) per day in the UK and NOK 40,000 ($3,900) in Norway, a rock-bottom level last seen in 2014.
Seabrokers calculated that April's average earnings for large PSVs were just £3,733, down 77.5% from £16,587 a year ago.
For large AHTSs, the figure was £8,141, down 51.5% from £16,775.
In the AHTS sector, the pool of active vessels is comparatively smaller than the PSV market.
This means vessel availability can still tighten much faster.
However, the drastic reduction in activity levels has obviously had a detrimental impact on rates in the AHTS market as well, Seabrokers said.
"In the UK sector, the majority of recent charters have been agreed with rates of less than £10,000 per day," the broker added.
"In Norway, only a handful of fixtures have involved owners managing to break the NOK 100,000 threshold."
The lowest level was just £5,000 per day.
Dearth of spot jobs
Broker Hagland Offshore lists one new spot requirement in the North Sea for PSVs, and one for AHTSs.
Another broking house, Westshore, cited PSV utilisation at 54% and AHTSs at 60%.
A total of 47 PSVs are laid up, with 63 working.
There are 30 AHTSs in the working North Sea fleet, with 31 vessels laid up.
With oil prices and demand falling, vessel charterers have been cancelling projects around the globe and putting downward pressure on rates as they grapple to control their costs.
The response from owners has also been significant, Seabrokers said.
"Having only recently started to make some headway following the previous downturn, many owners have no desire to repeat the experience of sending vessels out on hire at day rates that do not even cover their operating expenses," it added.
"Owners have been laying up vessels in their droves as their demand expectations for 2020 have suddenly been obliterated."
Shipping companies have been forced to refinance or seek emergency loans to tide them over an increasingly perilous period.
On Monday, Solstad Offshore said it had fixed five PSVs and an AHTS on medium-term charters outside the North Sea sector to reduce spot exposure there in 2020.
