- The demand for oil transports has stayed subdued since the April crash in oil prices.
- Oil tankers passing through the Suez Canal in October saw a sharp 27% decline.
- October recorded just 9 transits of LR1 tankers (55,000 – 80,000 DWT), which is a 74% drop.
- Dry bulk transits have risen 24.4% in the first 10 months of the year.
- Containership transits unsurprisingly fell by 14.4%.
A sharp 27% decline in the number of oil tankers passing through the Suez Canal was seen in October, reports BIMCO.
What is the reason?
The demand for oil transports has stayed subdued since the April crash in oil prices that fuelled high demand for oil tankers.
As a result, the number of oil tankers passing through the Suez Canal in October saw a sharp 27% decline.
Declined tanker transits
Oil tankers
A total of 3,708 oil tankers passed through this key chokepoint for global shipping between 1 January and 31 October. This represents 76 less oil tanker transits which is a 2% decline compared to the same period last year.
LR1 tankers
The steepest decline in October was recorded for LR1 tankers (55,000 – 80,000 DWT), which only saw nine transits, representing a 74% drop.
MR tankers
“The oil product tanker workhorse – the MR recorded the smallest drop in transits, down to 49 from 52 in October 2019, accounting for 16% of total oil tanker transits,” says Peter Sand, BIMCO’s Chief Shipping Analyst.
Rise in spot market demand
Back in May, a record 100 MR transits took place, representing 21% of all oil tanker transits.
At that time, the oil price war worked miracles for freight rates due to a sharp rise in spot market demand, resulting in a monthly record of 482 oil tanker transits.
Sand says, “Since May, the oil freight market has gone from fast forward to reverse, as illustrated clearly by the sharp drop in October for Suez Canal transits.”
Risen Dry bulk transits
In contrast, dry bulk transits have risen 24.4% (822 more transits) in the first 10 months of the year, whereas containership transits unsurprisingly fell by 14.4% (657 less transits).
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Source: BIMCO
