Not Logged In, Login,

Sunday, December 17, 2017

Suezmax fleet and market

Johan G Olsen’s (JGO) Suezmax Review lists 378 ships altogether, plus an orderbook of 150 (an increase of 11 from May). Fourteen of the suezmaxes listed are OBOs and five are used for storage and will never trade again. As many as 42 of the suezmaxes have been recorded as shuttle tankers, most of which are operated by Norwegian-based operators, and 4 as FPSOs/FSOs. We have recorded 57 single hull (SH) suezmaxes [including double bottomed (DB)/double sided (DS)], including 22 of 20 years or older.

 

96 (up from 78 in May) of the suezmaxes are fixed to 2009 and beyond, and 102 are oil company- / state-owned. This leaves 180 suezmaxes (down 7 from May) in the spot market. Four of the 1970s-built VLCCs listed by JGO are old tankers used for storage that are unlikely to trade again.

 

 

 

(The SH tankers built in the 1970s are used for storage.)

 

We have received reports of a number suezmaxes that have been sold for conversion to dry, heavy lift, and FPSOs/FSOs - 4 in both 2005 and 2006, and 13 so far in 2007. One suezmax has been sold for decommissioning. Looking at the table below (figures by Fearnleys) and judging by the number of suezmaxes shown in the fleet on 1 January 2001 and every year thereafter, there appear to be more suezmaxes that have been removed from the market than have been individually reported.  

 

Year

No suezmaxes*
1 Jan.

Increase

Deliveries**

Removals***

2001

284

-4.23%

16

-28

2002

272

2.57%

24

-17

2003

279

3.58%

25

-15

2004

289

3.81%

25

-14

2005

300

7.33%

25

-3

2006

322

7.33%

26

-4

2007

344

6.83%

26

-14

Est08

356

3.49%

20

-10

2009

366

2.81%

59

-19

2010

404

10.38%

44

-28

2011

420

3.96%

44

-38

Total

 

 

334

-190

*Source: Fearnleys Review **Source: LRF/JGO ***Calculated/projected

 

The phase-out according to MARPOL 2007-09 totals 5 VLCCs

 

The deliveries 2008- 2010 will most likely create a surplus of suezmaxes that may continue beyond 2015 even with no new orders, assuming a 2.5% increase in demand annually. It is also likely that some suezmaxes will trade until the age of 25 years, or maximum 2015, as 35 of them will be 20 years or younger in 2010 (if they are not converted) and there will probably be niches were they can continue to trade. It is also assumed that there will be 25 removals of SH tankers in 2008/9 before final phase-out in 2010.

 

 

 Some 102 suezmaxes are owned by oil companies and state-owned companies, which means that some 180 are in the spot market.

 

The four biggest suezmax owners in Johan G. Olsens' book are Teekay (32 suezmaxes/8% share), Frontline (18), and Konig (15). There are altogether some 105 suezmax owners, including a few with orders only. Several owners have more orders than they have existing vessels, such as Metrostar with 10 orders and Yasa with 5 orders. There are 9 owners with 5 to 11 orders each; the biggest is Marmaras with 11 suezmaxes on order. There are 25 owners with 5 suezmaxes or more.

 

Freight rates so far in 2007 have been very volatile but the average for (Wafr-US 130,000 ts) has declined more than USD 13,000 per day compared to 2006. Typical suezmax trades from West Africa and from the Mediterranean increased in 2006 and are set to increase also in 2007. The export of Azeri crude oil through the BTC pipeline to Ceyhan is projected to reach one million barrels per day in 2007.

 

 

Some 51% of the suezmax fleet operates in the spot market. The number of recorded period contracts of one year and longer was 23 in 2005 (average rate USD 35,178 per day), 18 in 2006 (average rate USD 36,839 per day), and 25 so far in 2007. The average period rate recorded in 2007 was some USD 38,136 per day ranging from USD 24,000 per day for a 1989-built to USD 50,000 for a 2020-built suezmax taken for 1 year.

 

 

 Contact: Erik Ranheim