Oil Tanker Firms Scrap Most Ships In Three Decades
by Tyler Durden
ZeroHedge.com
Sun, 12/30/2018
Companies around the world have scrapped a record number of large crude tankers in 2018.
About 100 vessels of the industry’s main crude carriers have been sent to India and Bangladesh for demolition, according to data from Clarkson Research Services Ltd., the statistical and research service arm of the world’s largest shipbroker.
Bloomberg said the shipping bust is no surprise, as of September the vessels, which transport 40% of the world’s crude, were on course for the worst charter rates in three decades.
In an August report, Bloomberg specified the implosion of charter rates was due to a two-year reduction of OPEC cargoes and environmental regulations. As we have said before, the global growth slowdown has certainly not helped.
Morgan Stanley estimates the global fleet of large crude carriers could lack 100 million barrels of transportation capacity in the first half of 2020.
“It prolongs the period of profitability after the turnaround,” said Fotis Giannakoulis, a New York-based shipping analyst at the bank.
“The more you scrap, the more you bring the recovery forward and accelerate its speed. The market will strengthen with high scrapping even with smallest growth in demand.”
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