Research and Projects




Surging liquefied natural gas trade

A report written and published in accordance with the Atlantic Council Policy on Intellectual Independence predicts that a surge in new supplies of liquefied natural gas (LNG) will hit the global market over the next several years. LNG export projects already under construction worldwide will add up to 175 billion cubic metres of LNG capacity by 2020, mainly from Australia and the United States...... Login to view this article


Wild cards in the tanker market

Demand for tankers was exceptionally high in 2015 for three reasons: OECD stocks were, according to the Paris-based International Energy Agency (IEA), built by two million barrels – or a VLCC load per day – and in addition Chinese strategic reserves were increased. China seized the chance to add up to 147 million barrels to its reserves in the first eleven months of 2015, according to Reuters’...... Login to view this article


Tension abounds in the oil and tanker market

We have witnessed a weakening of the tanker market and freight rates have been on the way down over the last days – while the Brent Blend oil price, after having breached the $30 per barrel level on the way down, has strengthened again.  One reason for the recent price increase was said to be rumours about possible oil co-operation to reduce production, but these rumours have to some extent bee...... Login to view this article


LNG recovery to take time despite strong demand growth

DNB Markets says that, despite 2016 being set to be the first year since 2011 with significant demand growth for LNG shipping, they estimate only a USD4k/day uptick in rates in 2016 due to close to historically weak fleet utilisation. Looking for upside potential, DNB highlights vessels rolling off old contracts becoming obsolete. DNB has only marginal changes to our 2016–2018 LNG trade...... Login to view this article


What can 2015 figures teach us on the 2016 tanker market?

The tanker market in 2015 will stand out as one of the best in history for big ships. The main reason for this is that global oil supplies expanded by 2.6 mbd in 2015, following gains of 2.4 mbd in 2014. Supply, though, cannot continue to increase stronger than demand as there will be a limit to stock building, even if the low oil price in the short term may stimulate the use of tankers as...... Login to view this article


Drama in the oil and tanker market

Oil is the most important strategic commodity in the world and the sharp plunge in oil prices have both economic and political effects, and will have an even greater impact should the low oil price continue for some time. But is it sustainable in any market that the price for a product is double the break-even rate for the marginal producer over a prolonged period? The tanker market has indeed...... Login to view this article


Fixing levels remain steady but longer hauls prove the difference

Last year, 2015, was one of the best ever for VLCCs. According to spot fixture data from McQuilling Services though, the number of fixtures was exactly the same as in 2014. That said, where the fixtures in the largest trade AG to Far East declined 8.3% (678 fixtures in 2015), the longer haul Americas-East increased by 20.3% to 172. The number of reported fixtures West Africa to India also...... Login to view this article


Increase in LNG exports accelerating

In an article in Kapital/Norway , the Market Analyst from Nordea, Axel Styrman, estimated that an overcapacity of 50-60 modern LNG tankers or about 20% overcapacity. This came as a consequence of high contracting activity after the Fukushima accident in Japan 2011, when the LNG import and demand for LNG tankers increased strongly. In addition there have been serious delays in the starting up of...... Login to view this article


Consequences of the change in the bunker price in the 2016 Worldscale book

The dramatic fall in the crude oil price has caused a similar fall in the bunker price, which is at the lowest level since 2004. This means that the bunker price used by the Worldscale Association has not reflected the market price. The bunker price used in the Worldscale (WS) book for 2015 was US$614.81 per tonne, whereas the new price for 2016 will be US$367.55 per tonne. The current bunker...... Login to view this article


Timing is everything

Tanker rates are over USD100,000 a day for a VLCC. The reasons for such high rates are high oil demand, oil stocks built up at record levels. The productivity of the tanker fleet is also low because there are delays in ports with the fleet still trading at reduced speed. Oil demand is by a large extent driven by a low oil price, which this week fell below USD40 a barrel. Low oil prices stimulat...... Login to view this article


Declining Asian LNG imports

Eastern Asian LNG imports dropped by 4.2% year-on-year in Q3 2015. According to Global Energy Hub, LNG gross imports dropped by 4.2 % year-on-year in Eastern Asia in Q3 2015. In Japan, South Korea, China and Taiwan LNG imports declined by 1.6 million tons from 38.1 million tons in Q3 2014 to 36.5 million tons in Q3 2015. In Japan, LNG imports were cut by 5.6% down to 20.9 million tons as...... Login to view this article


Stocks at record levels – IEA Oil Market Report

According to the Paris-based International Energy Agency (IEA), global demand growth is forecast to slow to 1.2 mbd in 2016 after surging to a five-year high of 1.8 mbd in 2015. Momentum eases towards its long-term trend as recent props – sharply lower oil prices, colder-than-year earlier winter weather and post-recessionary bounces in some countries – are likely to give way. Global oil supplie...... Login to view this article


Fleet growth

After moderate fleet growth in 2013/14, the growth is now picking up and could be around 3% in 2015, possibly rising to 6% in 2016 depending on sales for decommissioning. There have been very few sales for decommissioning so far in 2015 and with the strong freight market, scrapping activity is not expected to pick up. In addition to sales for decommissioning, we have recorded three VLCCs sold f...... Login to view this article


VLCC spot activity down

We are witnessing a strong crude tanker market, which for obvious reasons indicates strong activity. Spot chartering fixtures from McQuilling Services do, however, indicate that spot chartering activity for VLCCs up to October has generally declined in 2015 because chartering AG – Far East saw a decline. This could be because more cargo has been carried on Chinese-owned VLCCs, while we also hav...... Login to view this article


Plunging rates

VLCC rates peaked 5 October at $106,381 for the Baltic Benchmark route TD3 – Middle East – Japan, declined to below $50,000 per day but increased on Friday to above $60,000 per day. Both the aframax N Sea to Continent and the suezmax West Africa – Continent has improved over this period and the tanker crude oil tanker market is strong for all segments. What are the prospects? There is still an...... Login to view this article


Period chartering up

The average VLCC spot rates so far in 2015 have been at some two-and-a-half times the average rates for 2014, and in particular October has so far been very good for VLCC owners. Also, the other tanker segments have improved strongly compared to last year, however not by as much as the VLCCs. Spot chartering activity has, however, been about on the same level as in 2014 according to information...... Login to view this article


Saudi strategy clearly working

Saudi Arabia decided at the beginning of the year to produce oil at full level instead of reducing production to keep the oil price up. The main motive was probably to squeeze producers with higher production costs, in particular the US shale oil producers, and to discourage investments in exploration and production in marginal high costs areas. Non-OPEC oil production has started to decline an...... Login to view this article


Freight rates see records tumble

Nobody foresaw a rate of over USD100,000 per day for a VLCC this year. When VLCC availability gets scant, the sky is seemingly the limit for the freight rates. Fixture activity so far this year has stayed at approximately the same level until now. October has, on average, traditionally been the busiest month for VLCC fixtures and the beginning of this month has started with very active charteri...... Login to view this article


Report from INTERTANKO European Panel

INTERTANKO’s Senior Manager, Research and Projects, Erik Ranheim, made a market presentation at the recent European Panel meeting in Oslo. In during his presentation, he said that key issues facing the industry, and as a result should be watched, were: China Shale oil, US oil production declining Record Middle East oil production Iran – end boycott Oil stock high/floating storage Tonne miles...... Login to view this article


Oversupply of oil drives the tanker market

Global oil demand growth is expected to climb to a five-year high of 1.7 mbd in 2015 and has been the main driver in the strong tanker market. However oil supplies up to August stood at more than 2.4 mbd above the figure from the same time last year, with non-OPEC producers accounting for 43% of the gain. US oil production that peaked in March at almost 9.7 mbd, declined for the next three mont...... Login to view this article


Erik Ranheim
Senior Manager, Research and
P: +47 22 122 675