Discover and read the best of Twitter Threads about #tankers

Most recents (24)

Updated global fleet age and replacement requirements courtesy of the latest Danish Ship Finance report.

We are going to be hearing a lot more about negative fleet growth in #tankers and #drybulk in the coming years. Strap in for higher rates 🚀
Shipbuilding capacity still decreasing. Many second tier yards are unable to build the modern designs and sizes required. 129 second tier yards that delivered a ship in 2021 *did not receive any new orders in 2021*. These yards will most likely cease to exist in coming years.
Drybulk fleet detail. Orderbook to fleet acutely low in small sizes.
Read 5 tweets
1/ Dear all, many among you have asked me about my opinion on #oil, #logistics, #pipelines, price movements and a reality check on the #german #embargo plans. So I decided to make another explanatory thread. Grab a beer, this may take a while to read.
2/ It has often been said that oil is a global #commodity that travels on the seas. That view is not wrong, but incomplete. In fact, much oil is shipped by pipelines, on all continents. For an imcomplete but illustrative overview, see
en.wikipedia.org/wiki/List_of_o…
3/ Most pipelines either distribute incoming seaborne supplies to inland consumers (e.g., refineries), or they route domestically produced oil to seaports where it is loaded on #tankers.
Read 25 tweets
1/ Time for a check-in on $NMM

With clean product tanker rates surging I have seen a lot of enthusiasm and speculation about what this means for EPS going forward.

Updated my model with the latest charters from 20-F and ran a spot rate sensitivity on remaining open/index days:
2/ Unfortunately most of $NMM's product tanker fleet is already fixed for Q2, gradually rolling off charter throughout the rest of the year and into 2023.

It seems more likely to be a tailwind to an already huge contract backlog in containers and strong expectations in drybulk.
3/ Personally I am expecting around $16 EPS and $700M of operating cash flow for 2022 with the way markets are shaping up.

This puts year end net debt and capital leases at around $900M and EV at around $1.8B
Read 7 tweets
More observations on EU/US sanctions on Russia & possible implications on logistics disruption.

In April, India bought Russia crude for frist time ever. It bought 15mb in April according to news, altough we yet only measure 9mb as at 17 April 2022 through @Kayrros.

1/4 Image
How much crude needs to be diverted to Asia if self-sanctioning (or EU ban) bites? At least 2.9mbpd of Russian Urals in EU (1.6-1.8mbpd seaborne; 1.3mbpd Druzhba pipeline system into the EU) need to be diverted. So far, seaborne loadings increased in March! Time will tell.

2/4 Image
What does it mean to divert 1.8mbpd seaborne Urals away from Europe & into Asia? According to our calculation, it would increase ton-miles by a factor of 6 (!) & voyage time by a factor of 5 (!). In other words, Russian crude voyages will jump from 15 to 75 days on average.

3/4 Image
Read 5 tweets
1/ 15 months ago I penned an article entitled "Welcome to the New Container Shipping Supercycle" questioning the premises of popular conceptions of supply and demand at the time.

Some reflections on what I got right and what I got wrong.

A 🧵...

seekingalpha.com/article/439810…
2/ New ship deliveries are not hard to predict 2 years into the future as it takes upwards of 18 months to build most ships from contract date. A dearth of new ordering through late 2020 ensured insufficient supply coming to market to through 2023 to meet demand.
3/ I was also correct that there was limited capacity to add additional megamax ships in 2024.

What I completely underestimated was the enormous demand and shipbuilding slot availability for new panamax ships in lieu of available megamax capacity.
Read 13 tweets
1/ #Tankers are the biggest beneficiary of changing trade patterns due to Russian sanctions. PERIOD.

A look into why tanker rates are surging this week and why this is just the beginning.

A 🧵...
2/ The picture is becoming even clearer that Russian oil which used to go via pipeline and short sea to Europe will go all the way to China and **BACK** instead.

bloomberg.com/news/articles/…
3/ **BACK** from China? YES. The West is structurally short on refining capacity and the deficit is getting larger as Russian refining capacity becomes shut in and European refiners struggle to source the slate needed to run at full capacity. reuters.com/business/energ…
Read 16 tweets
Time for another rather unexciting weekly update! Pretty much a repeat of last week, where my portfolio saw some weakness early on, yet managed to crawl back up & ended up flat regardless! Down around 0.5% points, current YTD is 82.5%!
Current portfolio:

Sadly ASTL weighted down on performance this week & I had to make the tough choice to trim it down, so I could afford buying some #TANKERS!!! Added DHT & OET as VLCC rates finally have begun showing life again, looks VERY promising!
Comments: took profit from my SPUT longs a bit too early this week & added to SV longs instead, as I reduce leverage to minimize volatility in these wild times. So don't expect flashy moves from my portfolio, as I've intentionally tried to make it NOT do that!
Read 4 tweets
Wait, Huge!

$EURN $FRO #Tankers Image
- Ditch Belgium status with Dividend headaches?
- Savery Family aggressively buying into EURN, insider information?!?
- Allows Fredriksen’s daughters to more easily exit some exposure in a few years
- Large enough to get into Indices/passive money flows?
Read 6 tweets
Credit Suisse macro guru Zoltan Pozsar is even more bullish #tankers than the tanker bros here on twitter. His latest report makes the same macro call on tanker ton miles that I have been making

I can feel the generalists piling in 🚀

$FRO $EURN $DHT $INSW $STNG $NAT $TNP $NMM ImageImage
And although Zoltan goes into gory detail about tankers, his thesis extends to all seaborne commodities and the ships that transport them.

If he is right about additional bottlenecks, shipping rates across sectors will explode along with underlying ship asset values. Image
Ship values benefit when both the values of the commodities they transport and the steel they are made of increase.

Shipowning companies are levered long expressions of a high inflation macro thesis and could end up being the best performing real asset class this decade.
Read 3 tweets
#EIA #oil data: #crude -1.9 mln bbls; at 411.6 mln; -13% v 5-yr avg for period
#gasoline -1.4 mln bbls; +1% v 5-yr avg
#distillate -5.2 mln bbls; -18% v 5-yr avg
#propane -1.6 bbls; -21% v 5-yr avg
Total commercial stocks -8.1 mln bbls
#OOTT #OPEC #diesel #shipping #energy
#EIA #oil #data: U.S. #crude oil #refinery inputs averaged 15.4 mln bpd week to March 4, 2022, -21,000 bpd vs previous week; #refineries operated at 89.3% capacity; #gasoline output rose to 9.6 mln bpd, #distillate output fell to 4.6 mln bpd.
#OOTT #diesel #energy #refining
#EIA: #oil data: U.S. crude oil imports averaged 6.3 mln bpd last week, +0.6 million bpd vs previous week; last 4 weeks #crude oil imports averaged 6.2 mln bpd, +10.1% vs year-ago period
#OOTT #OPEC #diesel #shipping #inventory #energy #data #exports #crudeoil #tankers #imports
Read 4 tweets
Oh boy look at the time, it's Saturday & time for my weekly update!!! Started the week well, gave back a bit in the middle but managed to climb back up & ended with a 4% gain for the week, 22% gain YTD 🥳

Nothing too impressive, despite oil & coal doing a thing!
Got quite the W in my AMZN punt (albeit not even close to as much as I hoped...), but it was just a 2% punt that was partly offset by my FB punt lol.

Sadly had to trim core holdings to fund my gambling, but gonna buy back on weakness!!!
Sadly also got no #tankers exposure currently, which is pretty funny given how everyone else turned BOOLISH tankers now that Iran seems to get their nuclear deal after all... so plan next week is to buy back my positions in $DHT $TNK $INSW $FRO !!!
Read 4 tweets
Time to discuss the ugly cousin of 2021.

The cheapest, most attractive risk/reward part of the freight world.

The best value that I see in the whole commodity spectrum(apols #uranium clan).

You might have already guessed it; it’s finally time to talk abt #tankers #OOTT 1/n
had to keep on producing, floating storage was the only solution leading to a majestic surge in freight rates. As lockdowns eased, floating storage was no longer needed, thus supply came back online while demand was nowhere near 2019 levels. Naturally the mkt collapsed. 3/n
To date it has not recovered. 2021 has been an annus horribilis for the tanker market. Indicatively, $VLCC ytd returns are -$615/day (not a typo!). At the same time demand was getting normalized and $OPEC was steadily increasing production. 4/n
Read 12 tweets
Global shipping fleet in perspective thanks to UNCTAD. New ship order books for #tankers and #drybulk are at decade lows, yet shipyards are full through 2023-end with orders from other sectors. Sure looks like a massive shortage of aggregate shipbuilding capacity coming 2024+
Shipyard capacity has been declining for a decade and 2022 will be the most painful year for shipbuilders yet. Orders have since recovered, but many yards have locked in contracts at unprofitable levels due to high steel prices and could post losses through 2023.
Although it is obvious that more shipbuilding capacity will be needed to replace the surge of ships ordered during the last boom, shipbuilders will only begin repairing balance sheets in 2024 and will need years of profitability before planning new capacity.
Read 5 tweets
TANKER THREAD TUESDAY!

This week we will again explore the setup for product #tankers through the lens of their primary customers, oil refiners. My apologies in advance if this is repetitive of my earlier thread on the refinery landscape, but I hope you enjoy nonetheless. #oott
1/ Global refining was already in a state of overcapacity entering 2020, with the expectation of rationalization occurring slowly over the coming decade... then COVID happened.

Demand vanished, crack spreads went negative on most products and that decade compressed into 2 yrs
2/ The result has been a tectonic shift if the regional and global refining landscape that has implications not only on the energy industry and #tankers, but on geopolitics, trade relations, and state security for many countries.

However, we will keep it to tankers here...
Read 27 tweets
TANKER THREAD

Regional crude production and refining capacity drive short- and long-term demand for crude and product tankers.

With refining being one of the most COVID-impacted sectors of the global economy, the playing field for #tankers has shifted.

Who wins? #oott #EFT
2/ Product tanker owners like $STNG $TRMD and $DSSI have been consistently noting the structural tailwind in their market resulting from refinery closures across the developed world... a thesis supported by industry analysts.

What about crude #tankers?

tradewindsnews.com/tankers/refine…
3/ Crude Tanker Owners: "Robust product tanker markets only follow strong crude tanker markets"

While history supports this view, COVID has accelerated structural shifts in refining that suggest: "this time is different"

or for product tanker owners: "our time has finally come"
Read 15 tweets
A thread on #oil #product #tankers with excerpts from the latest Gibson weekly report:
hellenicshippingnews.com/wp-content/upl…

"Refinery rationalization is back on the agenda. With a prolonged weakness in refinery margins due to Covid-19 related demand destruction and an uncertain future..."
"...for hydrocarbon consumption, many refiners have decided to throw in the towel, choosing to either sell, close, or convert their refining assets. The impact is not just in Europe, but global. Aging capacity in the United States, Asia and Australia is also under threat."
"On a global basis, up to 2.6 million b/d of crude distillation capacity is at risk of full closure, or conversion to other purposes. But what does this mean for the tanker market?

In reality, it is unlikely to be a game-changer in the near term."
Read 5 tweets
1/
$STNG's Robert Bugbee & Hafnia's CEO Skov had a wide-ranging #tankers discussion w/ @RivieraMaritime 10 days ago.

It's shockingly hard to find this video, which is probably why it only had 15 views when I found it.



@ClassicValueInv & @mintzmyer
2/ Summary Notes follow:
Aging fleet, limited new builds, recovering end-market demand, etc. Weak near-term. Tight supply.

Same core story #tankers has been batting about for 18 months.

Notes: believe scale requirements (and consolidation) for product tankers going forward...
3/ are bigger than recent past (see recent $DSST and $ASC news as potential evidence).
Read 14 tweets
I'd like to share some thoughts about #tankers $EURN $STNG $FRO $DHT $TNK $INSW $ASC $TRMD $OET & the market in general.

It's counter-productive at best & delusional at worst to guide your investment decisions (I'm not talking about short-term trading) based on the market 1/n
whose inefficiency you seek to exploit.

Either you see a market inefficiency and move to exploit it or the market is pricing the asset efficiently and thus you move on (or accept market results).

From a short-term trading perspective things are different. You seek to 2/n
ride the market's ups & downs & thus you must constantly be tuned to the market's fluctuations & try to see what comes next.

If you're investing, volatility isn't risk. Your risks lie on business performance.

You buy what you think the market will like in a year or more 3/n
Read 13 tweets
@VadimPlz @ClassicValueInv Dry bulk is much different for several reasons.
1- Ships are built to do 25-30+ yrs. Besides fuel burn there is almost 0 difference between a 26y or a 2y ship. // Tankers start to get passed over 15+ and are generally avoided 20+. Surveys for tankers 17.5+ are very expensive.
@VadimPlz @ClassicValueInv Dry bulk demand core is iron ore and coal, both of which are driven almost entirely by Asian growth and stimulus. Coal future looks weak. Iron is purely Brazil-China. Iron looked good in ‘19 then singlehandedly got disrupted by $VALE. COVID wrecked ‘20.
@VadimPlz @ClassicValueInv The dry bulk fleet is not particularly old nor is the orderbook super small. @JamesCatlin76 has been hammering on this for a couple years. Dry bulk orders have gotten massive Chinese stimulus via Valemax and VLOC programs.
Read 9 tweets
Ok, couple of thoughts on #tankers noise. Here we go:
Bullish thesis:
1) contango for longer. Obviously dead now, no if and but. Dead. If it reappears it'll be a whole new case, for a bunch of different reasons.
2) supply/demand. Nonsense.
Supply is rising, demand is falling that's a reality. No matter how slow supply is rising when demand is peaked and then falling (secular!) this is a bad combination. Wanna proof? #drybulk. Ok, but how about scrapping?
3) first of all. You need rates to fall below OPEC for some
time and kind of a short-term hopeless consensus to kick this cycle, which is not a good position to be in from shareholders perspective. Secondly it'll take time and has to overcome the supply so that the whole tonnage really starts to contract, not just offsets increase.
Read 11 tweets
1) Im rarely willing to make short-term predictions on #tankers, but I see a strong chance of next-weeks rates having at least a modest bounce.
Could be wrong of course, but I think there are 2 very reliable long term data patterns that support that view:
2) I ve talked about the first one which is MEG-supply. Fearnleys already reported tightening supply for last week (see chart). Given current port congestion in FE+ extended May fixtures this month, I think the situation is likely worse by now.
3) Its very unsusual that we still havent seen a June charter by the 17th of the month. In theory that further tightens the window & elevates short term action despite production cuts. The Fearnleys data could also be massively impacted by port congestion.
Read 6 tweets
I'm doing a thread on the Danish Ship Finance report @Splash_247 highlighted here: splash247.com/danish-ship-fi…

The full report will be probably available sometime in the future here: shipfinance.dk/shipping-resea…

$STNG $ASC $DSSI $HAFNIA $INSW $EURN $TNK $FRO $DHT #tankers #oott #oil
This is their overview of where we are:
They see a challenging future ahead for shipbuilding and at face value, this sounds bullish for rates (ship supply is coming down right?) but it is not always so.

Desperate shipbuilders offer silly cheap prices to entice orders. Also, governments may decide to finance
Read 18 tweets
On #tankers: Let us help our audience on why we are long tankers. Thread...

1) A VLCC vessel has high operating leverage, allowing an investor to earn a very high ROIC, if you hit the cycle right.
In fact, a VLCC vessel may earn a multiple of its invested capital in one good year. See below our illustration for $EURN...
For that however, you need to understand the cycle! Which is why we developed a proprietary, bottom-up tanker market model over the years. Here a snapshot of our output mask...(it is a detailed model, believe us).
Read 12 tweets
So here is why we bought some call options in Euronav & Frontline. I know, crazy when the VIX is near record highs to buy anything. Let us explain regardless...

#tankers #shipping @hkuppy
Last year's bullish thesis on tankers was driven mainly by the US become net-seaborne exporter, driving ton mile as marginal barrels needed to travel more. We remained sceptical of that wisdom given our bearish view on US Shale. That thesis is now all but off the table. But...
With unrestrained production arriving in April after the breakdown of the OPEC+ alliance, along with lower global demand due to the coronavirus (COVID-19) outbreak, EA crude balance now shows stockbuilds of 355 mb from March to June! Wow.
Read 17 tweets

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