Dirty tankers were much less busy last year. File Image / Pixabay
Dirty tanker shipments dropped sharply last year as a combination of IMO 2020 market changes, plunging demand and limited storage availability conspired to keep more ships stationary.
There were a total of 2,255 reported VLCC spot fixtures in 2020, down by 7% from the previous year, brokerage Poten & Partners said in a research note this week. Suezmax ships saw an even steeper decline, losing 23% to 2,675 spot fixtures, while Aframax fixtures sank by 20% to 2,983.
IMO 2020 is likely to have been one cause of the decline, with large HSFO cargo shipments to Singapore happening much less frequently since the shipping industry's shift to VLSFO as its main fuel.
But the COVID-19 pandemic's effect on demand is likely to have been the biggest culprit. With jet fuel demand dropping to a standstill and road and bunker fuels seeing significant declines, overall crude demand took a big hit in 2020.
This led to a big increase in floating storage demand from the second quarter of 2020 as land-based storage started to run out of capacity, keeping more tankers out of the spot market.