Tanker Shipping & Trade: Goodbye to Business as Usual in the Tanker Market

06 Mar 2015: “An end of January briefing note issued by brokers Poten & Partners says that the outlook for the next six to 12 months looks favourable. It forecasts that average stock building will range between 0.6 and 1.3 million barrels per day. ‘Anecdotal evidence,’ says the note, ‘is that land-based storage is full and stock-building is continuing at a rate of 0.6–1.3 million barrels per day.’ Or in other words, the equivalent of a VLCC every 2-4 days. “By June of this year, says the briefing, some 80–110 VLCCs could already be in use as floating storage. Poten & Partners does not expect the stock building to continue throughout the year: ‘At some point somebody somewhere will blink [and] production cuts will likely lift oil prices and remove the incentive to store crude. As the storage vessels re-enter the spot market, tanker rates may come under pressure.’”