During the first half of 2019, the tanker markets produced voyage result per day levels that exceeded the corresponding period in the slump year 2018 by 50-100 percent, said Concordia Maritime.
The Swedish international tanker shipping company's view of market development going forward is largely unchanged.
Several factors still point to a gradually stronger market in autumn, it said. In addition to positive fundamentals in the form of sustained high demand for oil, seasonality and declining net tanker fleet growth, US exports of crude oil and oil products and the consequences of IMO 2020 are also helping to create exciting conditions.
"With regard to OPEC’s production, we had expected a decision on a gradual return to normal production rates at their July meeting. This did not turn out to be the case. If their decision to extend the production cuts persists, we are unlikely to get the extra boost we expected and hoped for. How this will transpire remains to be seen," Concordia said.
"Continuing production cuts would continue to decrease OECD oil stocks, which are currently in line with the important 5-year average. It is therefore not beyond the realms of possibility that OPEC will reconsider its decision as early as this autumn," it added.
"Developments during the second quarter were largely as we expected – namely, weak but still stronger than the corresponding quarter the previous year," the company said.
Among the reasons were OPEC’s production cuts, extended seasonal maintenance of refineries prior to IMO 2020 and extensive deliveries of new vessels.
The increased number of vessel deliveries is largely due to delays. The vessels should actually have been delivered in the first quarter but came into service in spring instead.
Normal refinery maintenance has been longer and more extensive than usual this year due to conversion work and preparations for IMO 2020. Overall, increased supply of vessels in combination with lower demand for transportation to and from refineries has contributed to lower market rates.
AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week