The purchase of Very Large Crude Carriers (VLCC) has seen a significant increase due to the ongoing crisis in the Hormuz Strait. Statistics show that VLCC purchases have risen from one tanker to 19 tankers this month. This surge in purchases has occurred particularly following heightened tensions and a decrease in oil transit through the Hormuz Strait. For example, the tanker Vadin, with a capacity of 308,000 DWT, which was built by Mitsui Ichihara in August 2006, was sold to Onex DMXX for $117 million.
Impact of the Hormuz Strait Crisis on the Tanker Market
The Hormuz Strait crisis has led to a severe reduction in oil transit from this region. Following the collapse of the ceasefire in early July, transit volumes through the strait have significantly decreased, and alternative options have also come under pressure. Drone attacks on the East-West pipeline in Saudi Arabia and threats from the Houthis around Bab el-Mandeb have limited options for moving Middle Eastern crude oil. As a result, tanker owners in the open market are less inclined to trade in the Gulf, and regional production and trading companies have turned to purchasing tankers as a way to maintain the flow of oil and money.
Read more: Daniel E. Brown appointed as the new CEO of Expand Energy
Price Increases and Demand in the Tanker Market
In light of these developments, revenues have also surged significantly. Charter rates for VLCC tankers on the route from the Gulf to China have exceeded $1,300,000 per day for the first time. Sale prices have also reached unprecedented levels. For instance, the price of 15-year-old VLCC tankers with a capacity of 310,000 DWT has increased by 163.45% compared to last year, rising from $55 million to $144.9 million. These price levels are likely correlated with the extent of the disruptions.
Onex DMCC, with its new purchases, especially following the Pinios deal, has joined six VLCC and Suezmax purchases in recent weeks. Another VLCC tanker, Ashoka, with a capacity of 302,600 DWT, built by Universal in March 2010, was sold to buyers in the Middle East for $130 million. These transactions are among the highest recorded prices for VLCC tankers and reflect a broad regional demand for available tankers.
Read more: Pranco UK completes decommissioning operations of underwater wells in the North Sea · UAE oil production reaches 5.3 million barrels per day
