X
<

Crude Tanker Stocks and ETFs: The Current Outlook

PART:
1 2 3 4 5 6 7 8
Part 7
Crude Tanker Stocks and ETFs: The Current Outlook PART 7 OF 8

Saudi Arabia’s Export Cut Weighs Heavily on Crude Tankers

OPEC oil production

OPEC (the Organisation of the Petroleum Exporting Countries) and a few non-OPEC countries have agreed on an oil production cut up to March 2018 to support oil prices. This production cut has huge implications for the crude tanker industry.

Saudi Arabia&#8217;s Export Cut Weighs Heavily on Crude Tankers

Interested in TNP? Don't miss the next report.

Receive e-mail alerts for new research on TNP

Success! You are now receiving e-mail alerts for new research. A temporary password for your new Market Realist account has been sent to your e-mail address.

Success! has been added to your Ticker Alerts.

Success! has been added to your Ticker Alerts. Subscriptions can be managed in your user profile.

In August 2017, OPEC crude oil production fell by 79 tb/d (thousand barrels per day) to 32.76 mb/d over the previous month. Oil production fell in Saudi Arabia, Iraq, Libya, and Venezuela.

Saudi Arabia

Oil production in Saudi Arabia fell by 10.3 tb/d to 10.02 mb/d over the previous months. Due to the production cut deal, Saudi Arabia is decreasing its oil exports. Saudi Arabia is expected to cut its crude oil exports by 350,000 bpd (barrels per day) in October 2017. It was expected to cut exports by 520,000 bpd in September 2017.

Most of the oil exports from the Middle East are carried through VLCCs (very large crude carriers). A fall in exports from Saudi Arabia proves negative for the crude tanker industry, especially VLCCs. We’ve already seen a drop in VLCC rates.

Production cut

Major oil producers agreed to cut crude oil production by 1.8 MMbpd from January 2017 to March 2018. OPEC’s next meeting is on November 30, 2017.

As oil supply falls, the demand for spot cargo falls too. Lower oil supply is usually negative for the crude tanker industry and companies such as Tsakos Energy Navigation (TNP), Teekay Tankers (TNK), Euronav (EURN), DHT Holdings (DHT), and Nordic American Tankers (NAT).

X

Please select a profession that best describes you: