Oslo-listed American Shipping Co (AMSC) expects the US Jones Act product tanker market to remain healthy for years yet.

The Lysaker-based owner said the entire fleet is fully employed, with short-term rates hitting $65,000 per day.

“The combination of demand for clean products across the US, increasing transportation needs for renewable diesel and favourable market conditions for transporting crude oil domestically drives the demand side in the Jones Act tanker market,” AMSC added.

The supply side of the market remains stable, with limited US yard capacity and rising newbuilding costs, making it unlikely that newbuildings will enter the market for years to come, the company said.

Norwegian investment bank Fearnley Securities said shipyards are tied up until 2026.

AMSC’s 10 tankers are a key part of the Jones Act fleet, representing about 30% of modern vessels employed in the trades.

The company said net profit rose to $5.1m in the third quarter, from $3.5m in 2021.

Bareboat revenue was stable at $22.3m. The contracted backlog is $185.3m.

AMSC is paying a dividend of $0.12 per share for the quarter.

Growth in profit ahead

Chief executive Pal Lothe Magnussen said: “We are pleased to have completed another quarter with steady financial performance.”

“We look forward to an active 2023, which we expect will bring growth in Ebitda and a continued focus on developing our fleet,” he added.

Earlier this year, the owner ventured into the offshore construction ship market with the $157m purchase of the 178-loa Normand Maximus (built 2016), which is leased back to operator Solstad Offshore.

This sector is currently experiencing increased activity and demand, particularly for subsea assets, AMSC said.

“The backlog for subsea EPC [engineering, procurement and construction] contracts, as reported by the three largest contractors, is continuing to grow and is currently at levels seen 10 years ago,” the company added.

Solstad continues to report a promising outlook and is working on several shorter and longer-term employment opportunities for the Normand Maximus after its current time charter expired in the fourth quarter.