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NEW YORK LONDON PERTH ATHENS HOUSTON SINGAPORE GUANGZHOUEmail: [email protected]
Product Power (Outage?): 2010’s Top Clean Charterers
An analysis of world‐wide clean tanker spot fixture volume in 2010 characterizes a sobering picture of developed‐world economic health. A significant 8.3% contraction in total reported fixtures from 2009 marks a downturn from what had seemed to be a market on the mend from the depths of the 2008 financial crisis. Although many pundits point to a rapidly‐growing eastern demand for tonnage in crude tanker markets as reason for optimism, nearly all market participants are left scratching their heads looking for any similar signs of optimism in the product shipping market.
This reported activity represents just a slice of the worldwide total fixture volume, but the numbers are undoubtedly underwhelming. If there was a sliver of optimism to be found in the reported clean fixture activity of 2010, it came in the form of a slight increase (3.3%) in reported Aframax (LRII) activity from 2009 levels.
2010 Reported Spot Clean Fixtures
460765
3,738 3,579
485709
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
LR2 (80‐119kdwt) LR1 (70‐79kdwt) MR/Handy (37.5‐59kdwt)
No. Spo
t Fixtures
2009 2010
January 21, 2011 www.poten.com
Source: Poten
NEW YORK LONDON PERTH ATHENS HOUSTON SINGAPORE GUANGZHOUEmail: [email protected]
The Voltron Crew
Instead of absolute fixture volume which can present a skewed view of total activity, this report focuses on the percent of total reported activity concluded by each company. Shell maintained its position from 2009 as the world’s largest clean charterer by fixture count (a distinction they also hold as 2010’s top crude tanker spot charterer) despite their total market share falling nearly 2% from the previous year. Vitol continued to close the gap in the second position also representing 6% of overall clean chartering volume in 2010. Other notable changes in the top 10 included BP and ST Shipping flip‐flopping positions in the top 5 from 2009 as well as Petrobras and Hess finding their way onto the list. Absent from 2009 included Morgan Stanley and Litasco.
2010 Charterer
% Cumulative
% 2009 Rank Charterer of Fixtures of Fixtures Rank 1 Shell 6.2% 6% 1 2 Vitol 5.9% 12% 2 3 Total 5.1% 17% 3 4 BP 4.4% 22% 5 5 ST 4.1% 26% 4 6 Trafigura 2.4% 28% 8 7 Petrobras 2.3% 31% ‐ 8 Clearlake 2.2% 33% 7 9 Chevron 2.2% 35% 10 10 Hess 2.1% 37% ‐
Note: Based on reported fixture data through December 31, 2010 for ships greater than 37,500 DWT
Major integrated oil companies and trading companies alike continued to dominate the ranks of the world’s top clean charterers in 2010. The top 10 charterers of 2010 also made up a total of 37% of total reported spot fixtures – a number lower from 2009 by 3% and nearly on par with 2008 (36%). Total fixtures reported for 2010 came in at 5218, down by 470 fixtures (or 8.3%) from 2009 levels but still off of 2008’s total 4,913 fixtures.
Source: Poten
NEW YORK LONDON PERTH ATHENS HOUSTON SINGAPORE GUANGZHOUEmail: [email protected]
Ballers and Shot‐Callers Aframax ‐ LR2 (80,000 – 119,999 DWT)
Clean Aframax (LR2) activity for 2010 showed a slight shake‐up in the top 10 charterers for the sector with Vitol edging BP as the world’s largest charterer representing 8% of total market share. Last year’s number one charterer, Shell, found themselves in fourth position this year behind Vitol, BP, and Total. Other changes in the sector’s top 10 included the additions of Itochu (9th) and Cargill (10th) with the departures of YNCC and Trafigura.
Top 10 LR2 Spot Charterers
7.8% 7.8%
5.8% 5.8% 5.6% 5.4%
3.9%
2.9% 2.9% 2.5%
0.0%1.0%
2.0%3.0%
4.0%5.0%6.0%
7.0%8.0%
9.0%10.0%
Vitol BP
Total
Shell SK
Marubeni
Petrobras
Reliance
Itochu
Cargill
No. Spo
t Fixtures
The predominant clean trade for Aframaxes continues to be the Arabian Gulf to Far East naphtha trade – a trend that seems poised to grow with the continued expansion of emerging market economies. The Aframax/LR2 sector also proved to be the only sector experiencing growth in clean fixture volume in 2010 – a trend undoubtedly attributable to growing eastern demand for refined products.
Source: Poten
NEW YORK LONDON PERTH ATHENS HOUSTON SINGAPORE GUANGZHOUEmail: [email protected]
Panamax ‐ LR1 (60,000 – 79,999 DWT)
Clean Panamax (LR1) chartering activity in 2010 saw a decline of 56 reported fixtures, or 7.3% from 2009 levels reflecting a weaker Arabian Gulf to UK Continent trade. Within the sector, the top six charterers showed no shakeup at all from 2009 as Shell, Vitol, Total, BP, Itochu, and ST Shipping all found themselves, respectively, holding the same positions from last year. The only changes within the sector’s top 10 charterers were the additions of Marubeni (8th) and Morgan Stanley (9th) and the departures of ENOC and Hess.
Top 10 LR1 Spot Charterers
10.2% 9.7%
6.6%5.8%
4.7%3.4%
2.4% 2.4% 2.1% 1.7%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
Shell
Vitol
Total BP
Itochu
ST Shipping
Chevron
Marubeni
Morgan Stanley KP
C
No. Spo
t Fixtures
Handymax (37,500 – 59,999 DWT)
Clean Handymax activity, making up the lion’s share of total clean market fixtures, saw a decline of 159 reported fixtures, or 4.3% from 2009 levels.
Top 10 Handymax Spot Charterers
5.8%
5.0%4.6%
4.3%3.7%
2.8% 2.6% 2.6% 2.6% 2.6%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
Shell
Vitol
ST Shipping To
tal BP
Trafigura PM
IHess
Chevron
Petrobras
No. Spo
t Fixtures
Source: Poten
Source: Poten
NEW YORK LONDON PERTH ATHENS HOUSTON SINGAPORE GUANGZHOUEmail: [email protected]
The ranks of the top five charterers within the sector fluctuated, but remained unchanged as Shell and Vitol reversed order in the top two positions from 2009 with Shell holding the crown at 6% of total reported market share. Vitol was followed by Total and ST Shipping who also swapped places from 2009 as 3rd and 4th largest charterers by volume, respectively in 2010 with BP holding onto its 5th place position within the sector. Filling out the top 10, PMI (7th), Hess (8th), and Petrobras (10th) all made their way into the top 10 charterers for 2010 replacing Litasco, Clearlake, and Morgan Stanley.
What’s Ahead for 2011?
The outlook for the clean tanker markets will go hand in hand with the economic health of product‐importing countries. Sluggish growth in the developed world will continue to hamper the sector’s health to the dismay of market participants. Outlooks by sector within the clean market may continue to diverge as well with LR2 and LR1 charters servicing far eastern markets finding buoyancy on the back of sustained demand from China and India. Additionally, the negative influence of ethanol additives in U.S. markets will not help to alleviate the plight in the clean product tanker markets. Until American and European economies can mount a formidable economic recovery, product power may prove to be anything but.
Poten Tanker Market Opinions are published by the Marine Projects & Consulting department at Poten & Partners. For feedback on this opinion or to receive this via email every week please send an email to [email protected]. For information on the services and research products offered by our Marine Projects & Consulting department or to contact
our tanker brokers please visit our website at www.poten.com.
