BUNKER INDEX :: Price Index, News and Directory Information for the Marine Fuel Industry



« News Home
:: Monthly Archive

News Topics
:: Air Pollution
:: Agreements & M&A's
:: Alternative Fuels
:: BunkerBlog
:: Cargoes & Storage
:: Company News
:: Efficiency, Costs & Charges
:: Environment
:: Events
:: Financial
:: Fuel Quality & Testing
:: Lubes & Additives
:: Oil Spills
:: People
:: Port News
:: Projects
:: Regulation, Legal
:: Services, Products,Technology
:: Statistics & Research
:: Vessels

Regional Archive
:: Americas
:: Asia/Oceania
:: Europe
:: M.East/Africa


BUNKER INDEX :: Price Index, News and Directory Information for the Marine Fuel Industry
Home » News





Teekay expects OPEC cuts, oil demand growth to support mid-sized tanker rates

18 May 2017 12:20 GMT

U.S. crude volumes are increasingly moving to Asia and Europe, which is supportive of mid-sized tanker demand.



Teekay Tankers (Teekay) says it expects changes in crude tanker trading patterns - driven by OPEC's recent production cuts - to support mid-sized tanker rates as global oil demand continues to grow.

In its analysis of the tanker market during the first quarter, Teekay noted: "The tanker market experienced downward pressure over the course of the first quarter due to heavy refinery maintenance, OPEC supply cuts and higher tanker fleet growth. However, changing trade patterns due to OPEC production cuts have provided support for mid-sized spot tanker rates, as a decline in Middle Eastern oil exports resulted in an increase in ton-mile intensive Atlantic Basin to Asia oil movements."

President and CEO Kevin Mackay said Teekay expected the tanker market to weaken into 2017 as a result of ongoing OPEC supply cuts and higher tanker fleet growth, but that "robust" global oil demand growth and changing trading patterns - due to supply cuts implemented by OPEC members - were expected to provide support to the mid-size tanker demand as more crude moves long-haul from the Atlantic to Asia.

Commenting on the effect of the 1.2 million-barrel-per-day (mbpd) production cuts by OPEC on the tanker market during the first quarter of 2017, Teekay said: "While OPEC cuts are negative for overall oil volumes available for transport, the mid-sized segments have found some support from increased ton-mile demand as Asian buyers look to Atlantic Basin supply to replace reduced OPEC barrels.

"For the first four months of 2017, U.S. crude exports averaged 0.4 mbpd higher year-on-year, and reached 1.0 mbpd by mid-March 2017. Overall, U.S. crude volumes are increasingly moving to Asian and European buyers, which is supportive of mid-sized tanker demand. In February 2017, China imported 0.3 mbpd of U.S. crude, overtaking Canada as the largest importer of U.S. crude."

The Bermuda-based tanker transportation firm added that the IEA's oil demand growth forecast of approximately 1.3 mbpd in 2017 would provide further support for mid-sized tanker rates during an otherwise challenging freight rate environment.

During the first four months of 2017, the world tanker fleet is estimated to have grown by 12.1 million deadweight tonnes (mdwt), or 2.2 percent. Total tanker fleet growth for 2017 is forecast to be 24.1 mdwt, or approximately 4.3 percent, which is slightly lower than 2016 but consistent with the ten-year average. Mid-size tanker fleet growth is expected to be around 10.7 mdwt, or approximately 5.6 percent, for 2017.

Overall, Teekay envisages growing crude oil supply from the Atlantic to Asia to provide some underlying support to help offset the negative fundamentals of lower OPEC supply and a period of higher fleet growth and softer tanker rates compared to 2016.

In 2018, meanwhile, Teekay expects to see a renewed market upturn driven by low new tanker ordering in the mid-sized segments, increased scrapping due to regulatory changes, and a more balanced oil market.

Key figures

In its results for the first quarter, Teekay Tankers posted a net income of $2.83 million compared to $38.98 million during the corresponding period in 2016.

Total revenue was $125.10 million - down from last year's figure of $164.95 million.




Related Links:

Teekay Tankers posts drop in net income, higher bunker costs
Teekay's first MEGI-powered LNG tanker completes first year
Teekay: oil supports tanker demand, higher bunker prices hit tanker rates

Latest News:

Second large LNG-powered bulker launched for ESL Shipping
MHI targets development of gas-fuelled ships
Wartsila in maintenance deal for eight LNGCs running on dual-fuel engines
Kandla invites bids to provide shore power to ships: source
Brent dropped as traders apparently went for profit-taking
Oil and fuel oil hedging market update
Peninsula Petroleum to launch bunker supply operation in LA/Long Beach
Europe's first LNG bunkering pontoon enters construction phase
Clean Marine secures EGCS contract for seven chemical tankers
EIA inventory stats showing same tendency as API, but with less magnitude
Oil and fuel oil hedging market update
NCL completes scrubber retrofits for two cruise ships




Page Links:

Prices
Africa
Asia
Latin America
Middle East
North America
North Europe
South Europe
Index Summary
Price Highlights
Commentaries
Futures
Prices
Antwerp
Busan
Cape Town
Fujairah
Houston
Istanbul
Kaohsiung
Las Palmas
Maracaibo
New Orleans
Piraeus
Rio de Janeiro
Rotterdam
Santos
Singapore
Directory
Africa
Asia
Central America
Middle East
North America
North Europe
Oceania
South America
South Europe
Directory
Germany
Gibraltar
Greece
Hong Kong
Italy
Japan
Netherlands
Panama
Russia
Singapore
South Africa
South Korea
Spain
Turkey
United Arab Emirates
United Kingdom
United States
News
Latest News
Blogs
Archive
Americas
Asia
Europe
Middle East
News
Air Pollution
Agreements & M&A's
Alternative Fuels
Cargoes & Storage
Efficiency, Costs & Charges
Environment
Events
Financial
Fuel Quality
Lubes & Additives
Oil Spills
People
Port News
Projects
Regulation/Legal
Services, Products, Technology
Statistics & Research
Vessels
Events
Upcoming Events