Ardmore "Very Bullish" on Product Tanker Outlook as Supply Growth Peaks

Ardmore says that they "believe that product tanker supply growth has peaked."

Ardmore Shipping Corporation (Ardmore) says it is "very bullish" on the product tanker market outlook, and are confident that the sector will strengthen over the coming winter months.

"We believe that product tanker supply growth has peaked, with deliveries to date being fully absorbed, and with the MR orderbook now the lowest of all the tanker sectors," said Anthony Gurnee, Ardmore's CEO.

"Given these market dynamics and the typical seasonal demand uplift, we are very bullish for the coming winter months and are already seeing signs of further strengthening in the spot market."

The comments come in its latest financial results where it also reported a $13.6 million net profit for the three months ending September 30, 2015, the equivalent of $0.52 per share.

Ardmore attributed the result to "well-timed fleet growth, a highly efficient operating platform," as well as successful implementation of their chartering strategy.

The company says that the product tanker charter market has shown consistent strength over the past year due to  "underlying secular demand growth resulting from Middle East refinery expansion, a growing dislocation of production vs. consumption, and continuing regional product imbalances."

The shipping company also notes that price volatility and supply-chain congestion in the oil market  has increased product tanker demand, a trend that it expects to continue for "the foreseeable future."

"With our final two newbuilds scheduled to deliver in the coming weeks and our 2016 revenue days set to increase by a further 23 percent from their 2015 level, Ardmore is well positioned to continue generating strong returns and creating substantial value for shareholders," concluded Gurnee.

In August, Ardmore announced the delivery of its third of four newbuild eco-vessels equipped with various fuel-saving systems.