The VLCC (Very Large Crude Carrier) tanker market has reached new heights that seemed unimaginable just a few months ago. Revenues for tankers operating on routes from the Gulf to China have surpassed one million dollars per day, and routes in the Atlantic have seen a significant increase to hundreds of thousands of dollars. The value of second-hand tankers has risen to the point where even 15-year-old and worn-out tankers are trading at prices higher than new tankers.
Analysis of the Tanker Market Situation
Tanker analysts now believe that the main question is no longer whether this market is extraordinary, but whether this is another sharp increase that will soon end or whether geopolitical disruptions have significantly impacted tanker supply and will keep revenues high until 2027.
Read more: Turkey Delays Deployment of the Osman Ghazi Floating Production Platform
Morgan Stanley, in its recent report titled "Trade and Fuel: The Golden Age," has stated that the effective supply of VLCC tankers may remain constrained beyond 2027. The bank has pointed to an aging fleet, longer voyages, floating storage, and existing disruptions, predicting that VLCC charter rates will increase by 20 to 30 percent. It sees three-year VLCC charter rates at around 100 thousand dollars per day and mid-term signals as more favorable than current spot numbers.
Challenges Facing the Market
The brokerage firm BRS has also addressed criticisms regarding comparisons to the crash following the 2007-2008 boom, stating that "tanker revenues need to be supported for a while from now on." The company estimates that about 15 percent of the VLCC fleet is somehow involved in shuttle arrangements in the Middle East. They have also predicted that the potential for inventory rebuilding in 2027-2028 could exceed 1.7 billion barrels, creating significant transportation demand.
Sentosa Shipbrokers has also concluded in its analyses that demand for tankers in the Atlantic is on the rise. Asian refiners seeking alternative cargoes from West Africa, the U.S. Gulf, and other regions have created longer voyages under conditions where few tankers are loading in these areas.
However, forecasts for the future of the tanker market face two opposing views. Proponents of rising prices believe that disruptions have effectively reduced the fleet and can sustain productivity for a longer period. In contrast, pessimists point out that high tanker revenues themselves are a factor that could ultimately destroy the boom and lead to new ship orders.
Read more: Iraq's Ministry of Oil Increases Oil Exports to Four Million Barrels per Day · Decrease in Tanker Traffic in the Strait of Hormuz; Incident with Two Injured
