Intertanko Athens Tanker Event 22nd May 15 1
Tanker Supply considerations
Fact: There is a 79% correlation between 1 year TC and VLCC contracting 8 kusd/d m dwt 35 3 6 25 4 15 1 5 1981 1982 1983 1984 1985 1986 1987 1988 1989 199 1991 1992 1993 1994 1995 1996 1997 1998 1999 1 2 3 4 VLCC 1 year TC Contracting (right axis) 5 6 7 8 9 1 11 12 13 14 15 YTD
Fact: It has for the past twenty years or so been fine to be invested in VLCC s! 8 kusd/d m dwt 35 3 6 25 4 15 1 5 1981 1982 1983 1984 1985 1986 1987 1988 1989 199 1991 1992 1993 1994 1995 1996 1997 1998 1999 1 2 3 4 VLCC 1 year TC Contracting (right axis) 5 6 7 8 9 1 11 12 13 14 15 YTD
Fact:..the periods of slump have been quite short during those years! 8 kusd/d m dwt 35 3 6 25 4 15 1 5 1981 1982 1983 1984 1985 1986 1987 1988 1989 199 1991 1992 1993 1994 1995 1996 1997 1998 1999 1 2 3 4 VLCC 1 year TC Contracting (right axis) 5 6 7 8 9 1 11 12 13 14 15 YTD
Fact: overcontracting used to be something in the past 8 kusd/d m dwt 35 3 6 25 4 15 1 5 1981 1982 1983 1984 1985 1986 1987 1988 1989 199 1991 1992 1993 1994 1995 1996 1997 1998 1999 1 2 3 4 VLCC 1 year TC Contracting (right axis) 5 6 7 8 9 1 11 12 13 14 15 YTD
Fact: overcontracting used to be something in the past 8 kusd/d m dwt 35 3 6 25 4 15 1 5 1981 1982 1983 1984 1985 1986 1987 1988 1989 199 1991 1992 1993 1994 1995 1996 1997 1998 1999 1 2 3 4 VLCC 1 year TC Contracting (right axis) 5 6 7 8 9 1 11 12 13 14 15 YTD
Fact: overcontracting used to be something in the past 8 kusd/d m dwt 35 3 6 25 4 15 1 5 1981 1982 1983 1984 1985 1986 1987 1988 1989 199 1991 1992 1993 1994 1995 1996 1997 1998 1999 1 2 3 4 VLCC 1 year TC Contracting (right axis) 5 6 7 8 9 1 11 12 13 14 15 YTD
Tanker Market just another slow boat to China?
A lesson from the past: 1 mill dwt surplus to get rid of 35 years ago! Demand CAGR Supply CAGR 198-85 -9,43 % -4,68 % 1985-9 7,22 % -,9 % 199-95 2,3 % 1,57 % 1995-3,6 % 1,58 % -5 3,21 % 2,49 % 5-1 2,81 % 4,62 % 1-15 3,9 % 3,3 %
It took 27 years for the fleet to surpass its 198 level! Demand CAGR Supply CAGR 198-85 -9,43 % -4,68 % 1985-9 7,22 % -,9 % 199-95 2,3 % 1,57 % 1995-3,6 % 1,58 % -5 3,21 % 2,49 % 5-1 2,81 % 4,62 % 1-15 3,9 % 3,3 %
.since then it has grown by 5 pct! Demand CAGR Supply CAGR 198-85 -9,43 % -4,68 % 1985-9 7,22 % -,9 % 199-95 2,3 % 1,57 % 1995-3,6 % 1,58 % -5 3,21 % 2,49 % 5-1 2,81 % 4,62 % 1-15 3,9 % 3,3 %
Crude tanker fleet fundamentals
Crude tanker fleet growing at 1,3% pa from 14-18 Crude Tanker Fleet Development 4 M DWT % 3 15% 1% 1 5% 1996199719981999 12345 6789111 121314151617 18 % -1-5% - Deliveries Orderbook Scrappings Est scrapping at age 25 y-o-y Growth -1%
Crude tanker fleet growing at 1,3% pa from 14-18 Crude Tanker Fleet Development
VLCC contracting vs Earnings and NB price 1 m usd k usd/d No 3 1 25 Classic ordering! 8 6 Strategic ordering? 15 4 1 5 12-jan 12-feb 12-mar 12-apr 12-mai 12-jun 12-jul 12-aug 12-sep 12-okt 12-nov 12-des 13-jan 13-feb 13-mar 13-apr 13-mai 13-jun 13-jul 13-aug 13-sep 13-okt 13-nov 13-des 14-jan 14-feb 14-mar 14-apr 14-mai 14-jun 14-jul 14-aug 14-sep 14-okt 14-nov 14-des 15-jan 15-feb 15-mar 15-apr VLCC contracting (right axis) VLCC NB price (left) VLCC earnings (left)
Contracting vs Earnings and OB/fleet-ratio 7 6 No k usd/d Orderbook restraint! 25% % 5 4 15% 3 1% 1 5% 12-jan 12-feb 12-mar 12-apr 12-mai 12-jun 12-jul 12-aug 12-sep 12-okt 12-nov 12-des 13-jan 13-feb 13-mar 13-apr 13-mai 13-jun 13-jul 13-aug 13-sep 13-okt 13-nov 13-des 14-jan 14-feb 14-mar 14-apr 14-mai 14-jun 14-jul 14-aug 14-sep 14-okt 14-nov 14-des 15-jan 15-feb 15-mar 15-apr % VLCC contracting (left) VLCC earnings (left) Orderbook/Fleet (Right)
Product tanker fleet fundamentals
Product tanker fleet growing at 3,1% per year from 14-18
MR contracting vs Earnings and NB price 4 35 m usd k usd/d -Prices on the rise/earnings falling.but ordering continues!! No 45 4 3 25 15 1 35 3 25 15 1 5 5 12-jan 12-feb 12-mar 12-apr 12-mai 12-jun 12-jul 12-aug 12-sep 12-okt 12-nov 12-des 13-jan 13-feb 13-mar 13-apr 13-mai 13-jun 13-jul 13-aug 13-sep 13-okt 13-nov 13-des 14-jan 14-feb 14-mar 14-apr 14-mai 14-jun 14-jul 14-aug 14-sep 14-okt 14-nov 14-des 15-jan 15-feb 15-mar 15-apr MR contracting (right axis) MR NB price (left) MR Earnings
Contracting vs Earnings and OB/fleet-ratio 45 4 No k usd/d Complete cut-off in ordering despite rising earnings! 25% 35 % 3 25 15% 15 1% 1 5% 5 12-jan 12-feb 12-mar 12-apr 12-mai 12-jun 12-jul 12-aug 12-sep 12-okt 12-nov 12-des 13-jan 13-feb 13-mar 13-apr 13-mai 13-jun 13-jul 13-aug 13-sep 13-okt 13-nov 13-des 14-jan 14-feb 14-mar 14-apr 14-mai 14-jun 14-jul 14-aug 14-sep 14-okt 14-nov 14-des 15-jan 15-feb 15-mar 15-apr MR contracting (left) MR Earnings (left) Total Product Orderbook/Fleet (Right) %
Final Fact: There will never, ever be a permanent shortage of shipbuilders!
That s it!
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