Very large crude carrier rates should continue to skid along bottom of five-year range
Another year of historically low rates -- driven by a combination of Opec and non-Opec nation prouction cuts, the redeployment of tankers as floating storage and consumers drawing down stocks on hand -– should encourage scrapping of the oldest tankers, and even some shy of their expected 25-year lifespan.
"We are going to see some teenage vessels scrapped," he said at the Argus Americas LPG Summit in Houston, Texas. "This happens very rarely and takes a really bad market, but we have already see one 1999 (vessel) and a 2000 sold for scrap. For that to happen in a big way would require a few more months of big pain for shipowners."
New ballast water requirements starting late next year and sulfur emissions limits in 2020 also could speed up retirements, even as the tankers ordered in the middle of this decade continue to be delivered into the glutted market.