Crude and product tankers can look forward to the longest period of strength since the 2008 financial crisis with oil consumption set to hit record highs next year, said industry body Bimco.

Oil demand led by China, increases in average haul linked to sanctions imposed on Russia and slow fleet growth are all contributing to the “firmly positive” outlook for the sector, said the shipowner group.

Freight rates have not yet matched peaks at the end of 2022 but earnings “remain solid and time charter rates and second-hand ship prices are at their highest levels since the financial crisis of 2008”, it said.

Tonne miles have been 9.4% higher than in 2022 so far this year for crude tankers, and 7.5% for product tankers it said.

China is key to the tanker sector and the 4.5% growth of its economy in the first quarter of this year has been slightly behind forecasts.

But expected increased oil shipments to China, the world’s largest importer, after it emerged from Covid-19 lockdowns have seen the group upgrade forecasts for cargo demand for both clean and dirty tankers for 2023. It said the resurgence in vehicle and air travel has been “very positive” for tanker demand, it said.

Tanker demand has been underpinned by the increase in voyage distances as Russia seeks markets outside of Europe for its oil and the European Union is forced to bring in oil from further afield.

The group says it expects sanctions to remain in place throughout the next 18 months even if the war comes to an end.

Oil consumption in 2023 is expected to reach 101m barrels a day to exceed 2019 levels for the first time since the pandemic. Demand is expected to hit 102.7m barrels a day next year.

The increased demand follows cuts announced by some Opec+ countries until the end of this year, which Bimco says could increase prices and affect the economy. “However, risks remain firmly tilted towards the downside,” it said.

“Both sectors can look forward to a continuation of the very favourable trading conditions experienced during the past year and the longest period of market strength since the financial crisis,” it said.

The positive outlook was highlighted by Oslo-listed Frontline, which on Wednesday reported its best net earnings in the first period of a year since 2008.