Longstanding warnings from the oil tanker industry that too few of the ships are being built are coming back to haunt the market after Houthi attacks on commercial shipping caused widespread diversions in global petroleum trades.
Just two new supertankers are due to join the fleet in 2024 — the fewest additions in almost four decades and about 90% below the yearly average this millennium. But after owners increasingly started to shun the southern Red Sea, the lack of new capacity is starting to bite: rates have seen spikes, and voyage durations are going up.
Rates had been held in check last year as OPEC and its allies kept oil off the market. At the same time, a wider energy transition is meant do away with fossil fuels — dimming the industry’s outlook in the longer term. But increased avoidance of the southern Red Sea is adding to the duration of trades that had already become elongated due to Russia’s war in Ukraine.