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Product Tanker Sector Set for Historic Fleet Expansion by 2025: Insights from BIMCO

The product tanker sector is preparing for a significant increase in fleet capacity, with new deliveries expected to reach 12 million deadweight tonnes (DWT) in 2025, marking a 256 % rise from 2024’s 3,4 million DWT, according to BIMCO.

BIMCO’s data indicates that this growth stems from a surge in contracting activity during 2023-2024, where 551 new vessels totaling 38,7 million DWT were ordered, far surpassing the previous decade’s annual average of 122 ships.

Oil tanker
ULCC tanker Amyntas
Source: wikipedia.org

As a result, the orderbook has expanded to 41,2 million DWT, with the orderbook-to-fleet ratio increasing from 6 % to 22 % over two years.

In terms of segment distribution, BIMCO reports that MR tankers led in volume with 278 new orders, while the LR2 segment accounted for the highest capacity at 19,2 million DWT. The delivery schedule for 2025 includes 98 MRs and 52 LR2s, representing 4,9 million and 6,0 million DWT, respectively.

However, BIMCO raises environmental concerns regarding this fleet renewal. Only 7 % of the vessels scheduled for delivery in 2025 will be capable of using alternative fuels, and 12 % are retrofit-ready. This limited adoption of green technologies, coupled with slow recycling rates, poses environmental challenges.

BIMCO’s Chief Shipping Analyst, Niels Rasmussen, notes that reduced recycling activity has resulted in an aging fleet. He states:

“The low recycling activity during the past five years has created an overhang of older ships,” with 10% of the fleet’s capacity currently consisting of vessels older than 20 years.

The analysis from BIMCO suggests potential market challenges ahead. While fleet growth is anticipated to reach 5-6 % in 2025, a slowdown in oil demand growth may lead to decreased tanker demand. Additionally, ongoing geopolitical issues, such as Russian sanctions and disruptions in the Red Sea, could delay the retirement of older vessels, potentially causing market imbalances.

Январь, 17, 2025 55 0
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Author photo - Olga Nesvetailova
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A creative freelancer with the ability to study source literature and create relevant material. The sea has always attracted me with its unbridledness, mystery, and a love of creativity helped me express my most interesting thoughts and reflections on paper, therefore, now I am doubly interested in studying the world of shipbuilding and writing useful materials for sailors.
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