The supply chain crisis brought with it an escalation in the prices of maritime freights due to the inability of the transport supply to meet the needs of an increased demand for goods as a result of the pandemic, and which has now slowed down due to the return to normality and the bad global economic expectations, producing an almost general drop in prices in the sector.
However, there is one notable exception: the market for oil tankers and their derivates, which in 2022 saw a record price rise that was largely due to the disruption in tanker trade caused by the Russian invasion of Ukraine in February of 2022, and the subsequent imposition of sanctions, as well as the attempt by the West to limit Russia’s profits from its energy exports.
During 2022 the ton-mile ratio grew very rapidly, as Russia’s crude exports were diverted from Europe to China and India, and European countries needed to source from new markets.
Overall oil trade growth doubled in terms of tanker deadweight demand last year, largely due to this increase in tonne-miles, a multiplier effect that is expected to continue into 2023, albeit with some slowdown in trade growth.
There are no signs that the war will end anytime soon, and this trend of steady tanker gains looks sustainable into 2023, but the full ban on imports of Russian oil products into the EU from 5 February 2023 will have an impact, along with the December 5, 2022 price cap on Russian oil.
There are many discussions about the existing trade and scenarios about a possible dark trade involving Russian-linked tankers. At the same time, most European shipowners already prefer to avoid any cargo related to Russian oil, while those in Asia are buying large quantities of barrels from that country.
The consequence of the war in Ukraine will continue to be a buoyant market with good underlying fundamentals, although some moderation is expected in spot earnings with some fluctuation.
The expectation for 2023 is that there will be some moderation in the general levels of earnings, which, however, will remain quite high, surely compared to the beginning of 2022 and particularly with 2021, when the market was weak.