Download your complimentary copy of our latest quarterly shipping outlook, as our Principal Maritime & Trade Analyst Dalibor Gogic provides an update on the latest developments in the shipping industry and an assessment of the fleets as owners respond to the upcoming IMO 2020 sulfur cap.

Key take-aways include:

  • IHS Markit estimates 3.5%S/0.5%S bunker fuels differential at around 300 $/tonne in their basic scenario for 2020 due to disruptions both in refinery and shipping markets
  • Fleet size structure, average voyage length, average time spent steaming and economies of scale are most likely to be taken into consideration among other factors including bunker availability, when deciding on fleet compliance options
  • Return on investment is faster for a larger fleet due to consumption, average distance and proportion of time spent steaming
  • The recent announcement about scrubber installation options among larger fleets (VLCC/VLOC and ULCS) seems to confirm the forming trend of early adopters hedging against potential differential cost or expecting to earn premiums, while expecting faster return on investment
  • Slow steaming has been a standard among major fleets in the last few years, and further potential for slow steaming is narrow as savings on bunkers through slow steaming has been exercised for quite some time
  • Operators of older fleets competing with younger more efficient fleets come January 2020 will be under increased pressure. For older fleets the cost of compliance could be high when mixing dry docking, Ballast Water Treatment System installation and fuel compliance

Quarterly Shipping Outlook: September 2018

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