Tanker Orderbook High Despite Market Unpredictability

Increased sanctions (enforcement), resilient oil demand, partly due to stock building in China, and growing OPEC+ supply have all contributed to create a rate environment we have not seen since the freight rate boom in the early days of the pandemic, says Poten & Partners in an opinion this week.

Very limited fleet supply growth in 2024 and 2025 has also contributed.

“A tightening supply-demand balance has made the freight market more susceptible to small changes in ton-mile demand. The strong cashflows that are being generated in the current freight market has given owners added confidence to look at fleet growth and renewal.”

Tanker orders were modest during 2021 and 2022, which led to the low deliveries in 2024 and 2025. Contracting accelerated in the years following the Russian attack on Ukraine, in particular of Aframax/LR2 and Suezmax tankers, the segments that benefited the most from the Russian aggression.

Owners sold older secondhand vessels into the “dark fleet” at ever higher prices and reinvested at least some of these proceeds into new orders. VLCCs orders in 2024 tripled relative to the previous year.

For 2025 YTD, ordering has been lower than in 2024, but the overall orderbook for delivery over the next three to five years has grown significantly. The total tanker orderbook as percentage of the existing fleet is currently 16%, solidly in the double digits. Recent headlines from the trade press suggest that more orders are in the pipeline, especially for larger crude oil tankers.

Tanker contracting activity is highly cyclical and is largely driven by current cashflows and owners’ confidence in future markets. Unfortunately, tanker markets are notoriously hard to predict, and it always takes a leap of faith to commit many millions of dollars to build an asset that will only deliver several years into the future, says Poten & Partners.

The benefit of new construction is that shipyards offer installment plans allowing owners to spread out payments. Only a 10-20% payment is usually required upfront.