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Saturday, October 20, 2018

EU phase-out of oil tankers 5,000 – 60,000 dwt

We have analysed the tanker fleet 5,000 – 60,000 dwt (oil tankers and chemical/oil tankers) using the LR/Fairplay database, in order to look more closely at the effect of the EU phase-out regulation.

OIL TANKER FLEET 5,000-60,000 DWT BY HULL

Flags

Double Hull

DB/DS

Single Hull

Total

Africa

1

5

19

25

Japan

16

1

25

42

Indonesia

2

6

43

51

N America

28

15

47

90

S America

25

10

71

106

China

36

3

86

125

Asia/Pac

155

43

211

409

FSU

25

6

116

147

EU2

98

49

113

260

EU

332

59

78

469

Open register

374

87

260

721

Grand Total

1092

284

1069

2445

There are some 78 single-hull (SH) tankers and 59 double bottom (DB)/side (DS) tankers (of a total of 469 tankers in this size category) flying European Union flags that are affected by the new regulation, which means that only 30% (by vessel number) of the EU flagged fleet is affected. The EU has by far the biggest share of double-hull (DH) tankers in this segment.

The total oil tanker fleet 5,000-60,000 dwt is some 58 mil dwt (including all those ordered for 2003) of which 21.6 m are SH and 7.4 m dwt are DB/DS (50% by dwt). The EU part is 11.8 m dwt, of which only 1.8 m dwt is SH and 1.5 m dwt DB/DS (28% by dwt) . Only about 0.6 m dwt of EU, 0.9 of other European and 1.4 m dwt of open register ships are due for phase-out this year in this segment. The phase-out figure would be about 8 m dwt this year if the world fleet was affected rather than just EU-flagged vessels.

The fleet of the ‘Other European’ countries is dominated by Malta- and Cyprus-flagged tankers, which will not be directly affected until these ‘accession’ countries become full members of the EU – in May 2004.

When looking at the whole fleet, we may assume that a large number of these tankers trade regionally. The fleet outside Europe and the open registers represent just over 40% of the total tanker fleet 5,000 to 60,000 dwt. The European fleet accounts for some 30%, and the open registers as we have defined them make up some 30% of the fleet. More than 50% of this fleet sector are double-hulled.

The graph shows that the peak in 2010, when 37 EU tankers, 38 other European tankers and 113 open register tankers will be phased out of Europe, will be bigger than the peak in 2003 when a total of 150 of these tankers will be affected.

When looking at the orderbook, using a combination of Fairplay figures and the last Clarkson Shipyard Monitor, there are some 310 product tankers of 5,000 to 60,000 dwt on order totalling some 12 million dwt. Looking at the world fleet, phase-out up to 2006 is 11.7 m dwt. If we only look at European and open register tonnage, the current orderbook covers phase-out until 2009/10.

Considering that a relatively large part of the European fleet is already double-hulled, the phase-out requirement will probably not have a big impact on this sector.

In addition to the EU single-hull phase-out requirement, heavy oils now have to be carried by DH tankers to European ports, which could cause additional problems in this sector.

It should be noted that there is some uncertainty concerning the accuracy of these figures both with regard to the PL/SBT status (Category 2), the type of hull (DH, DB or DS) and the involvement in oil trading.

Contact: Erik Ranheim