Production is expected to rise in April, boosting the demand for oil tankers.
Since 2022, OPEC+ has restricted oil production to stabilize prices, cutting output by 2.2 million barrels per day (bpd). The group has announced a production increase of 138,000 bpd in April, marking its first step towards gradually easing these cuts. This decision follows pressure from President Trump to lower oil prices amid geopolitical uncertainty. This relatively modest increase results in an additional demand for about 5 suezmax tankers, highlighting the significant potential if the entire 2.2 million bpd reduction is lifted.
Expected increase in revenue for the coming months
Increased production leads to more crude oil exports for the tanker market. This boosts the demand for tankers, mainly VLCCs and Suezmax, which transport oil over long distances. With limited fleet growth, a rise in the volume of cargoes at sea could drive up rates.
As OPEC+ gradually restores supply, the increase in crude exports from the Atlantic basin and the extension of trade routes are expected to boost tanker revenues in the coming months.
Source: Reuters