Ship recycling market picking up the pace
The ship recycling has been on a rise last week, with India as the standout performer. In its latest weekly report, Best Oasis (www.best-oasis.com), a leading cash buyer of ships, said that “India’s ship recycling market is improving, driven by robust local demand anticipated to maintain favorable conditions this month. Bangladesh’s market is stable but slightly declining. Challenges include sluggish demand from steel mills and LC issues from USD shortages, while an influx of Chinese-built vessels has impacted buyer confidence. Pakistan’s market remains unchanged with no new vessel entries and persistent slow activity, though steady recycling rates persist despite diminished construction sector demand, suggesting possible future price drops”.
Tanker orders increase 32pc year-on-year
Tanker ordering levels have increased during the first few months of 2024. So far this year, 104 Tankers have been added to the global orderbook, up from 79 for the same period last year, representing a year-on-year increase of c.32 percent.
Values for Tanker newbuildings have also increased across all subsectors. LR2s of 115,000 DWT show the biggest leap, up by c.7.31 percent from the start of the year from USD 69.11 mil to USD 74.16 mil, as values for this sector maintain their upwards trajectory and hover around the highest levels since 2008.
Of the Tankers ordered this year, the majority were in the MR sector, accounting for c.37 percent, followed by VLCCs with c.31 percent, Suezmaxes with c.19 percent, and LR2s with 12 percent, respectively. Aframaxes were in fifth place with just 1 percent of all orders placed this year. No LR1 orders were reported. More than half of these orders have been placed at Chinese yards with a share of c.57 percent, South Korea ranks second with a share of 36 percent, and Vietnam rank third with 6 percent. Japan accounts for just 1 percent of Tanker orders placed in 2024 to date.
How the OSV shortage is sparking a digital transformation
Ashortage of OSV vessels is a catalyst for significant digital transformation within the industry. Many OSV vessels were decommissioned or withdrawn during the pandemic, and with markets now recovering, this is leading to a scarcity that has resulted in higher day rates, with higher costs exacerbated by fuel costs that are also on the rise. Opsealog’s Business Director, Damien Bertin, explains how, in response, the sector is turning to digital solutions to optimize fleet management and fuel efficiency, which is shaping the industry’s approach to operational challenges.
The current oil and gas market is characterized by rising demand, especially from major oil-producing nations in the Middle East, which is driving the urgent need for more offshore support vessels. This surge in demand is prompting shipowners and charterers alike to reassess their fleet strategies and operational practices.
Ship recycling markets looking for more growth
The ship recycling markets have shown a mixed picture during the past week. In its latest weekly report, Best Oasis (www.best-oasis.com), a leading cash buyer of ships said that “in the ship recycling markets across four key destinations, distinct trends are observed. In India, the market shows positive momentum with stable rates, and prevailing conditions suggest continued market favorability, assuming stable supply levels and no major geopolitical disruptions. Bangladesh’s market has reactivated post-Eid holidays, experiencing a slight increase in activity and a rise in inquiries, with clearer market trends expected to emerge next week”.
Safe mooring: navigating new imo regulations with DNV
The high frequency of mooring operations and a high level of human involvement have resulted in multiple safety incidents related to mooring over recent years.
The International Group of P&I Clubs reported 858 injuries and 31 fatalities involving mooring operations during the five-year period before 2021. This has been a key driver behind new SOLAS requirements related to mooring from the IMO.
Brazil’s import of Russian clean petroleum products jumps 135pc
“Since the European Union sanctioned Russian oil exports in 2022, crude oil and dirty and clean petroleum products (CPP) have found new buyers. India and China have taken most of the crude oil and dirty products while Türkiye and Brazil have emerged as the main buyers of CPP. Year-to-date, Brazil’s import of Russian CPP has increased by 135 percent year-on-year,” says Niels Rasmussen, Chief Shipping Analyst at BIMCO.
Historically, the US has been the main supplier of CPP to Brazil, accounting for about 50 percent of all Brazilian CPP imports. Since April 2023, Russia has been the main supplier and volumes from the US have declined by nearly 50 percent so far this year compared to the same period last year. Instead, US exports to Europe have increased.
“Following the implementation of EU sanctions, Brazilian CPP imports from Russia increased during the first months of 2023, reaching an average of nearly 650,000 tonnes during the last eight months of the year. In 2024, average monthly volumes have risen further to 830,000 tonnes during the first four months,” says Rasmussen.
Demand for larger tanker classes expected to increase in tandem with ton-mile increase
Increasing ton-mile demand is projected to become the norm in the tanker market, prompting many owners to increase their exposure to larger vessels. In its latest weekly report, shipbroker Intermodal said that “the first quarter of 2024 saw a great deal of movement and disturbance in the crude oil market, mostly due to strategic production adjustments and geopolitical conflicts. Rising tensions in the Middle East and noteworthy disruptions to Russian refinery operations marked the beginning of the period, which had a major effect on supply limitations and general market circumstances. Even while the outlook for the world economy was generally good, a slump in OECD countries in particular, moderated the increase in demand for crude oil globally. Non-OPEC+ nations, especially those in the Americas, significantly increased output on the supply side, indicating a move towards a greater reliance on non-cartel sources”, Intermodal said.