Tanker market slows as market uncertainty and high values create headwinds

Throughout the course of 2024, tanker values continue to hover around the highest levels since 2009, however the volume of sale and purchase activity for larger tankers has slowed considerably as the appetite for this sector takes a dip amidst market uncertainty. In September there were 55 large tanker sales reported, this included seven VLCCs, eight Suezmaxes and nine Aframaxes and in contrast, since the start of Q4 2024 to date, just 43 sales in this range have been reported, with six VLCCs, 28 and nine Aframaxes.

To put this in perspective, in January 2024, a total of 92 tankers were reported sold which included 27 VLCCs, 15 Suezmaxes and 12 Aframaxes. Sales have slowed as a result of very high prices and weak demand from China combined with uncertainty over the recent US elections and what the incoming President Trump may hold in store for the oil trade. TC Rates have fallen month-on-month for all crude tankers with VLCCs down by around c.2% from the same time last month. While the current rate of around 42,900 USD/day does not indicate a weak market, uncertainty remains.

Count of Tanker Sales 2023-Present

Values for larger tankers have remained around 15-year highs for most of the year. For example, values for 10-year-old VLCCs of 320,000 DWT are up by c.8.934% year-onyear, from USD 76 mil to USD 83.91 mil. However, over the last month Tanker values have corrected lower across almost all sub sectors and age categories. This month alone, values for 20YO Suezmaxes of 155,000 DWT dropped by c.8.91% from USD 31.64 mil to USD 28.82 mil. Notable sales include the VLCC Tricia II (281,100 DWT, Aug 2000, Mitsubishi HI) sold to unknown Chinese for USD 20.9 mil, VV Value USD 22.93 mil also the Suezmax Evagoras (165,200 DWT, Mar 2003, Hyundai Samho Heavy Ind) sold to undisclosed buyers for USD 25mil, VV Value USD 26.35 mil.

High tide ebbs for tanker market amid uncertainty and high values

Author: Rebecca Galanopoulos