ECONOMY

Orders for new tankers reach a new 30-year high

Orders for new tankers have hit a new 30-year high, according to data from the international shipbroking group Simpson, Spence & Young (SSY) published this week. There is a rise in orders across all tanker categories, as the maintenance of high freight rates and the compulsory withdrawal of certain older ships in the near future have sent shipowners to place orders with shipyards. New orders for very large crude carriers (VLCCs) are a characteristic example: Today 147 such ships, which can carry an average of 300,000 tons of oil, are under construction, against just 86 at the new year. The profitability of these vessels is guaranteed under the present market conditions. Frontline, the sector’s biggest company according to the shipping capacity of its fleet, recently reported that each VLCC ship it owns should have daily revenues of $28,252 in order to cover its expenses. However, shipowners receive about $42,000 per day for chartering a VLCC, according to calculations by Bloomberg and the Norwegian shipbroking agency RS Platou. Smaller tanker categories, such as suezmax and aframax ships, show the same picture: In 2006 alone there were 35 new orders for suezmax tankers and 100 for aframax vessels, SSY suggests. Suezmax ships can carry up to 1 million barrels of oil and aframax tankers have a capacity of 650,000 barrels. Aframax ships are increasingly popular among Greek shipowners, as the monthly shipbuilding reports of Greek shipbroking agencies show. Allied Shipbroking suggests that the Angelikousis Group, through Kristen Navigation, Alpha Tankers and Anangel Shipmanagement reportedly submitted an order for a total of four aframax tankers and two suezmax tankers in October. Other Greek companies to have reportedly made similar orders are Metrostar of Theodoros Angelopoulos and Dorian Hellas of the Hadzipateras family, while Dynacom of Giorgos Prokopiou continues to invest in VLCCs. The renewal of the tanker fleet is essential, not just because the bigger oil companies, such as BP, Total and Chevron, charter exclusively modern double-hull tankers, but also because after 2010 older, single-hull tankers will not be allowed to operate on certain routes. Another shipping survey firm, UK’s Drewry Consultants, confirms that in the year’s first quarter, tanker orders trebled from Q1 2005, reaching 377, with a capacity of 38.4 million dwt, against orders for just 101 tankers of 7.5 million dwt in 2005.