Cleaned-up crude tankers are pushing Torm to lower its 2024 guidance.
The Danish product tanker owner revised its full-year time-charter equivalent earnings projection to between $1.11bn and $1.16bn from a range of $1.15bn to $1.35bn.
The revision comes as the company reported a stronger quarterly performance year on year, but also one where crude tankers were snapping up clean cargoes and holding down rates.
“During the third quarter of 2024, tonne-mile demand related to clean petroleum products grew by 12% year on year,” the company said.
“However, during the quarter around 50 crude tankers cleaned up to transport clean petroleum products and thus captured much of the additional tonne-mile demand.”
Profit came in at $131m for the quarter, up from $124m for the same period last year on the back of $263m in time-charter revenue.
The top line was an improvement from the $244m with its fleet bringing in an average of $33,722 per day, up from $33,010 per day.
But crude tankers picking up clean cargoes accelerated in the second half, sending rates on a countercyclical dive.
For the three months ending on 30 September, Torm’s LR2s earned $41,064 per day, its LR1 vessels $33,749 per day and its MRs $31,193 per day.
So far in the fourth quarter, rates have fallen further.
Torm said 52% of its fourth-quarter earnings days have been booked at $29,044 per day.
On a segment-specific basis LR2s have had 61% of revenue days booked at $40,704 per day, LR1s have 37% booked at $28,263 per day and MRs 51% at $24,493 per day.
Torm is the second tanker owner to report crude tankers pushing into product spaces were dragging on earnings.
On Wednesday, Odfjell said the moves were pushing product tankers to look for chemical cargoes, with the company reporting a quarterly profit drop and that 6% of all product tankers were now trading chemicals.
