According to Xclusiv, “moving from Europe to Asia, India has announced its intention to compete in the growing global trade market, by establishing a new state owned shipping company. This venture aims to expand India’s fleet by over 1,000 vessels within a decade, reducing reliance on foreign shipping and capturing a larger share of trade revenue. The new company will collaborate with state-run oil, gas, and fertilizer industries to secure business and leverage expertise from existing entities like Shipping Corp of India. If and when these plans start to come to fruition it will significantly affect the SnP and newbuilding market. The government hopes to cut freight costs by a third by 2047, with estimates suggesting a potential rise to $400 billion if they rely solely on foreign carriers. Headquartered at GIFT City, a financial hub designed to rival Singapore, the new company will benefit from a maritime development fund and potentially become stakeholders with state-run firms signing long-term charter deals. This initiative reflects India’s ambition to become a world-class manufacturer and a developed nation by 2047”.
Meanwhile, “at the wet market side, many market executive and energy traders have expressed their belief that crude tanker rates could rise this summer and beyond due to a combination of factors. While OPEC+ initially decided to extend production cuts, limiting global supply, this was counterbalanced by a drop in crude prices. However, the planned easing of these cuts from October onwards is expected to lead to higher demand for crude tankers, particularly VLCCs transporting oil from East Asia in the fourth quarter. The impact might be limited though, with a significant release of OPEC+ cuts needed to truly incentivize the carry trade (buying oil for future delivery) and significantly boost tanker rates in 2025. The potential increase in production by OPEC+ could also lead to weaker oil prices in the next year, although this is not the base case scenario”. Amazon Fba
Customs Clearance Xclusiv added that “independent of OPEC+, recent weeks have seen a rise in crude tanker demand due to factors outside the oil producer group. Increased production from non-OPEC sources like the US, Canada, and Guyana is offsetting the OPEC+ cuts and leading to more long-haul exports, particularly from the US to Asia. This trend is reflected by rising inquiries for VLCC crude oil cargo loadings in the Atlantic Basin. China’s growing demand for oil after its spring refinery maintenance season is also a positive sign for the VLCC market, with roughly half of VLCC loadings in April and May destined for the country. Additionally, the ramp-up of refinery activity in West Africa, particularly in Nigeria, is creating new trade routes within the Atlantic Basin and boosting demand for VLCCs. Overall, while the picture is complex, the combination of rising non-OPEC production, easing OPEC+ cuts later in the year, and increased demand from key regions like China point towards a potential rise in crude tanker freight rates, particularly for VLCCs in the later part of 2024”, the shipbroker concluded. Nikos Roussanoglou, Hellenic Shipping News Worldwide