New shipbuilding orders in China reached 1210.6 million tons based on deadweight tonnage (DWT) in the first half of this year, which is 2.7 times more than the same period last year. This significant increase is due to the diversification of crude oil supply lines following the conflict between the United States and Iran.
China's Share of Global Orders Increases
Following these developments, China's share of total new global orders has risen to 82 percent. In fact, China now accounts for the majority of the new global shipbuilding volume. China State Shipbuilding Corporation (CSSC), the world's largest shipbuilder, received 22.45 million tons of new DWT orders in the first half of this year, more than double the figure from the same period last year.
Read more: Iraq to Start Oil Production from Al-Qurnayn Najaf Field in 2027
Significant Growth in Orders for Oil Tankers
Hengli Heavy Industries, one of the private shipbuilders in China, also received 207 new orders in the first half of this year, which is significantly more than the total orders for last year (115 ships). This increase in orders is due to shipowners in Asia diversifying their crude oil suppliers and ordering large oil tankers for transporting oil over long distances to China.
Analyses show that the U.S. airstrike on Iran has contributed to the boom in China's shipbuilding industry. With the near-total blockade of the Strait of Hormuz and the inability of ships to exit the Persian Gulf, shipowners in Asia have been compelled to order large oil tankers from Chinese manufacturers.
According to BIMCO, global contracts for oil tanker construction reached an all-time high in July. Steven Gordon, CEO of Clarkson Research, stated that as the geopolitical situation becomes more complex, the need for increased transport capacity is growing.
Interestingly, this surge in shipbuilding orders in China has not yielded the desired results for the U.S. government during Donald Trump's presidency, and the U.S., once a major shipbuilding power, has ceded its competition to Japan, South Korea, and China since World War II.
According to data from the U.S. Office of Naval Intelligence (ONI), the production capacity of shipbuilders in the United States is only 100,000 GT per year, which accounts for just 0.5 percent of China's capacity (23.25 million GT).
Read more: National Iranian Oil Company Begins Early Gas Production from the Pazan Field · Increase in Coal Demand Following the Strait of Hormuz Crisis
