Shipbuilders are welcoming orders for what are currently the stars of the shipping world, the Very Large Crude Carriers (VLCC), at a rapid pace.

The number of agreements for the construction of new tankers has increased in terms of carrying capacity to 7.4 million dwt, an increase of 490% on an annual basis. A total of 19 VLCCs were ordered, surpassing, as noted by the international maritime organization Bimco, the number of orders placed for this category of tankers throughout the entirety of 2023.

The surge in orders for these large tankers is due to the high freight market. Since the outbreak of the Ukraine-Russia conflict, oil transportation has significantly strengthened and continues to do so in the first two months of 2024. New crises, such as the one developing in the Red Sea, are equally favoring the freight market. Europe's need for oil following sanctions against Russia has been met by regions such as the USA and West Africa, resulting in increased sailing time for ships, which in turn means increased demand.

Bimco forecasts that in the coming years, more oil will come from America and that oil demand will shift increasingly towards Asia. It's clear that this trend will extend sailing distances and thus particularly benefit VLCC ships, given that they already dominate these trade routes, usually transporting crude oil from the Middle East and America to Asia.

In March 2023, the order book for crude oil tankers represented just 3.3% of the existing fleet, the lowest point since 1996. During 2023, orders for VLCCs significantly increased. Approximately 70% of the carrying capacity of ships that started construction in 2023 and those that began this year will be delivered between 2026 and the end of 2027. Consequently, freight rates will be supported in the coming years by the low increase and availability of the fleet until then.