The VLCC market has entered one of its strongest phases in recent years, with earnings surging past $100,000 per day. As highlighted in the BRS Weekly Tanker Newsletter and cited by TradeWinds, the current rally stands apart from previous short-lived spikes. Instead, it is being powered by strong and sustainable fundamentals on both the demand and supply sides, pointing to continued strength into 2026.
Robust Global Oil Flows Fuel Demand for VLCCs
VLCCs have been the center of attention during Bahri Week, with the Baltic Exchange basket earnings exceeding $100,000/day and pushing the Q4 2025 average to nearly $84,000/day a 78% rise from the previous quarter.
Unlike past surges often caused by temporary disruptions, the present upswing is rooted in steady and increasing crude flows.
The Middle East Gulf continues to anchor VLCC demand as OPEC+ eases supply cuts and refinery maintenance drives long-haul shipments to Asia. Additionally, Brazil and Guyana are strengthening global supply, with Guyana now enabling year-round VLCC loading. Much of this crude is destined for China, where ongoing stock building remains a key driver of the market’s momentum.
Limited Vessel Supply Tightens the Market Further
On the supply side, the VLCC fleet growth remains constrained. Deliveries are at multi-year lows, reducing the number of vessels available for mainstream trading. The rise of the sanctioned grey fleet has further narrowed the pool of compliant tonnage.
Although a larger batch of VLCC newbuildings is scheduled for delivery next year, the impact will be partly offset by many vessels reaching 20 years of age and becoming less competitive in major routes. At the same time, heavy orderbooks for Suezmax and Aframax vessels may trigger cargo cascading ahead, influencing neighbouring segments but keeping VLCCs well-supported.
The latest surge in VLCC earnings is fundamentally different from previous short-term spikes. Supported by strong crude supply, firm demand from Asia, restrained fleet growth, and structural market tightness, the VLCC sector appears set for continued strength into 2026. As market fundamentals improve and the lows of 2024–2025 fade, the sector is entering a period of elevated and more stable returns.
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Source: BRS
