Tanker Market Making Extended Earnings Run In 2015: BIMCO

The association says rate averages posted in Q1 have not seen since 2008.

BIMCO has reported that a strong tanker market is extending peak season high earnings with averages not seen since 2008.

The shipping association said average earnings for VLCCs were around $51,000 per day in the first three months of 2015, a figure that is 76 percent higher compared to the first quarter of 2014's rate of around $29,000 per day.

BIMCO went on to report that Suezmaxes earnings were around $50,000 per day in 2015 compared to around $31,000 in 2014.

"As regards to the Aframaxes the difference between the two years was a bit smaller, however still noticeable with around $40,000 per day in Q1 2015 up from around $29,000 last year."

BIMCO noted that following the winter peak season of 2013/14, crude oil tanker earnings collapsed and remained low during spring before rebounding over the summer.

Although BIMCO acknowledged the steady demand for oil contributing to 2015's high rates, it cites a reduction of fleet for the three crude segments as a more substantial factor.

"[It] has shifted the supply and demand curves, and it is safe to say it has contributed to keeping the earnings at the level we see today."

Peter Sand, chief shipping analyst at BIMCO, said, "The strong winter market for crude oil tankers was in line with our expectations. But on top of that is this extended run of strong earnings that proves the window of opportunity is still open as a result of very advantageous fleet growth levels for all crude oil tanker segments."

Sand added that "BIMCO expects crude oil tanker supply growth at 2.2 percent in 2015. This is a three-year high.

"Fortunately, it's still a level that should see healthy earnings for crude oil tankers throughout 2015, all other things being equal."

Three months ago, Frontline Ltd. predicted continued demand and solid freight rates for oil tankers in 2015, helped along by the ongoing collapse in oil prices.