The outlook for the crude tanker market is optimistic, with anticipated increases in cargo volume ranging from 2% to 3% in 2023 and 3.5% to 4.5% in 2024, according to Niels Rasmussen, chief shipping analyst for Bimco.“Contracting of crude tankers has remained subdued, and the order book remains low at only 3.7% of the size of the trading f leet. New ship deliveries will, therefore, remain low for the coming period. However, no crude tankers have yet been recycled in 2023, and we expect recycling to remain low for the rest of the year and during 2024,” said Rasmussen during a recent online event.Year to date, in 2023, both crude and product tankers have sailed marginally faster than during the same period in 2022: crude tankers by 3.6% and product tankers by 0.5%. At the same time, congestion has been lower than in 2022 by 1.6% and 2.9% for crude and product tankers, respectively.Increase in sailing distances“We anticipate an increase in average sailing distances, leading to tonne mile growth of 5% to 6% in 2023 and 5.5% to 6.5% in 2024. Similarly, the product tanker mile is expected to grow cargo volume between 3% and 4% in 2023.”Rasmussen said Bimco remained optimistic for 2024 because while there were signs of a slowdown in global economic activity, China continued to drive global oil demand thanks to increased travel and jet fuel consumption.The US Energy Information Administration predicts China will account for more than half of the 3.4 million barrels of oil per day increase in oil consumption between 2023 and 2024. It does, however, warn that the ongoing conf lict between Israel and Hamas could have an impact next year. “While it has not affected physical oil supply at this point, uncertainties surrounding the conf lict and other global oil supply conditions could put upward pressure on crude oil prices in the coming months,” said a spokesman.The organisation forecasts the Brent Crude oil price will increase from $90 per barrel (b) in the fourth quarter of 2023 to an average of $93/b in 2024.Rasmussen said production cuts by Saudi Arabia and Russia had already pushed crude oil prices up, although this had not impacted consumption to date. “If it does lead to a reduction in crude oil shipments, it will have a short-term impact, but once the market rebounds, there will be an immediate increased need for shipping.”According to Rasmussen, sailing distances in the crude tanker market are set to increase as production increases in the Americas and while refinery capacity grows in Asia, the Middle East and Africa. “As refinery capacity is not growing in Europe or the Americas, sailing distances are also expected to grow for product tankers, with the f leet expected to grow by at least 2.2% this year and by 1.3% next year. The crude tanker f leet is also expected to show growth of around 2% in 2023 and 0.4% in 2024.”Ship recyclingThe recycling of ships had so far been significantly lower than previously estimated, said Rasmussen. “Due to increased contracting, the order book has grown to 9% of the trading f leet. This will impact f leet growth in the coming years but does not impact the estimates for 2023 and 2024 as the ships contracted will be delivered later.”He said no changes were expected to sanctions on Russia’s oil and oil product exports within the next year and a half. The shifts in trade and increased sailing distances resulting from the ongoing sanctions would not see any change in the foreseeable future.He said the biggest concern for the sector in 2024 was a slowdown in the Chinese economy, and banks worldwide had already lowered their forecasts for growth in the country.
