Used Oil Tankers Surpass New Ones in Price Amid Record Freight Rates

The oil tanker market has experienced an unprecedented surge in demand, driving prices of used vessels above those of new ones for the first time. According to the Financial Times, the main reason behind this unusual situation is the record-high freight rates on routes from the Middle East to Asia. Specifically, VLCCs (Very Large Crude Carriers), the largest oil tankers capable of carrying approximately 2 million barrels of oil, have seen their freight rates reach around $1.2 million per day.

This has led buyers to prioritize vessels that can be delivered immediately over new ones, which take longer to build and deliver. As a result, used tankers that are five or ten years old are now selling for more than $150 million each, with some deals exceeding $200 million. For example, a recently built oil tanker was sold for $200 million on an 'immediate delivery' basis.

Alexander Savaris, CEO of CMB Tech, described the current market as 'unique' and 'a once-in-a-generation event.' He noted that it's difficult to compare current price levels with normal market fluctuations. The shipbroker Braemar also observed that a vessel's age has almost no impact on its price in this market.