Tankers: Conflicting shipbuilding forecasts

Analysts are “lost in translation” in the tanker shipbuilding market.

The reason for the confusion is that traditional models for processing economic fundamentals cannot accurately calculate the immeasurable impacts that the turmoil caused by the “naval battles” at a geopolitical level can have on the market, but also for how long they will affect it.

A typical example is the shipping brokerage house Poten & Partners, which specializes in liquid cargo.

In a previous analysis, it had expressed the opinion that the order book will decrease in 2026.

However, a few days later, and after several analysts supported a different view, the following was stated: “We will provide more evidence on why we believe (and hope) that the order book will decrease, but also why we may ultimately be wrong.”

The “traditional” and the “opportunistic”

For “traditional” shipowners, ordering tankers is mainly about fleet renewal, expansion or diversification.

These shipowners, Poten noted, are usually very demanding in terms of technical specifications and maintenance of ships and rarely consider buying used capacity.

They sell older ships and order new ones throughout the cycle, often with coverage through long-term charters. Most are private companies, and usually with a strong capital base.

On the other hand, Poten emphasized, there is a large group of investors that follow a different, more opportunistic approach.

The activity of “opportunistic” shipowners often pushes up ship values.

The tanker industry is characterized by high volatility in both revenues and asset values. Geopolitical conflicts and sanctions further amplify these cycles.

The result is usually relatively short periods of high revenues, followed by prolonged periods of underperformance.

Tankers are long-term assets, with useful lives of more than 20 years, which means that short periods of over-order can create long periods of over-supply.

Under normal circumstances, the industry should replace about 5% of the fleet annually.

Given that the lead time for new ships is currently around three years (a ship ordered today will be delivered in late 2028 or early 2029), an order book of around 15% of the fleet is theoretically balanced.

However, this also assumes that around 5% of the fleet is retired each year, i.e. sent for scrapping. This has not happened in recent years.

Despite limited newbuilding deliveries, the tanker fleet is growing steadily, as scrapping remains low.

Older ships are sold for further commercial exploitation in the so-called “dark fleet”, rather than being sent to the scrapyards.

To replace or expand their fleet, they compare newbuildings with second-hand ones and closely monitor the relative prices, as well as current and future revenues.

These movements are much more difficult to predict compared to those of traditional shipowners.

This category also includes private equity firms, other financial investors, as well as trading houses.

Geopolitical developments

Geopolitical developments dominated tanker markets over the last year, with a wave of sanctions targeting Russia in particular, secondary measures against entities trading Russian and Iranian crude, the brief Israel-Iran conflict, Trump’s inauguration, the US trade wars and the US-China standoff over port fees among the key events.

So far, this year is proving to be as “eventful” as 2025, Gibsons said.

Recent developments in Venezuela have come as a major surprise, causing a sharp reshuffle of the country’s crude flows.

Exports have shifted away from Chinese independent refiners, with the bulk of cargoes, at least for now, remaining within the Atlantic basin.

Although the picture continues to evolve, initial cargoes are likely to be mainly directed towards the US market.

This has already contributed to a strong rise in aframax rates, which have hit multi-year highs in recent weeks.

Tensions over Iran are also rising. While domestic unrest appears to have subsided, the US is significantly increasing its military presence in the Middle East, as part of a broader show of force against Iran.

The course of events remains highly uncertain. However, for the main tanker markets, the risks are clearly oriented towards increased volatility.

Any attack on Iranian oil infrastructure, disruption of exports or an attempt to block the Strait of Hormuz would have immediate and serious consequences for freight markets.

A more structural shift could occur in the event of a regime change.

Furthermore, any military escalation between the US and Iran could reignite Houthi attacks in the Red Sea, with Iranian officials recently issuing new warnings.

Meanwhile, Russia-Ukraine peace talks are also underway. The latest trilateral talks were described as “constructive” but failed to yield substantial progress, with further discussions scheduled for February.

While a comprehensive settlement remains difficult, achieving one would have far-reaching implications for oil flows, prices, demand for major tankers, the sanctions regime, demand for the “dark fleet”, older tonnage values and scrapping levels.

Failure to reach an agreement would likely lead to tougher direct sanctions and more aggressive secondary measures, further disrupting freight markets and potentially further shifts in trade flows.

Recent seizures of tankers linked to Russian trade by US authorities in the North Atlantic and by French forces in the Mediterranean highlight that the risk of state intervention is increasing, driving the market largely into uncharted waters.