BIMCO's Chief Shipping Analyst, Niels Rasmussen, has highlighted a significant surge in product tanker deliveries this year. According to current schedules, 2025 will see 12 million deadweight tonnes (DWT) of new product tankers delivered, a staggering 256% increase compared to the 3.4m DWT delivered in 2024. This marks a 16-year high and the second-highest level on record.
This surge in deliveries stems from a significant increase in new ship contracting during 2023 and 2024. During this period, 551 new ships with a capacity of 38.7m DWT were contracted, surpassing the previous 10-year average of 122 ships (7.3m DWT) per year.
Consequently, the order book has surged from 10.6m DWT at the beginning of 2023 to 41.2m DWT at the start of 2025, with the order book to fleet ratio increasing from 6% to 22%.
The MR segment has seen the highest order activity with 278 ships contracted, while the LR2 segment leads in terms of capacity ordered with 19.2m DWT.
Deliveries in 2025 will be dominated by MRs (98 ships) and LR2s (52 ships), adding 2%, 6%, 3%, and 12% to the DWT capacity of the Handysize, MR, LR1, and LR2 fleets, respectively.
Despite the surge in new orders, only 7% of the ships scheduled for delivery in 2025 will be capable of using alternative fuels, with another 12% being readied for eventual retrofits. Slow recycling activity in recent years has led to an aging fleet, with 10% of the fleet's capacity now comprising vessels over 20 years old.
While a return to normal recycling rates would help address this issue, ongoing geopolitical challenges, such as Russian sanctions and Houthi attacks in the Red Sea, may further delay the retirement of older ships. Rasmussen anticipates that fleet growth will reach 5-6% in 2025, while slower oil demand growth is likely to temper product tanker demand growth.