Recent surge in MR product tanker newbuilding orders could harm weak market recovery, warns US-based consultancy McQuilling Services.
“Based on the current delivery profile and looming surplus, we believe these orders may be premature and earnings could suffer,” McQuilling said in a report on Thursday.
The warning follows forecasts at tanker conferences this year that product tankers will recover more quickly than other shipping segments as fewer orders had been placed over the last few years.
That delicate recovery now appears to be in the balance, given owners’ current enthusiasm for ordering new product tankers.
Data from Clarksons show that 35 contracts for new MR tankers in the size range 30,000 dwt-59,999 dwt were signed by the end of April, up from five contracts signed for new vessels of that size in that period last year.
However, McQuilling does not believe there has been a robust enough change in the market to justify the ordering spree.
“Lacking any significant improvement in demand fundamentals in the clean product trades, we were surprised by the surge in MR2 newbuilding contracts,” said the report.