Prominent players in the global crude oil carriers market are China Shipping Development Corp (CSDC), AET Tanker Holdings Sdn Bhd, Euronav, The National Shipping Company of Saudi Arabia, and Dynacom Tankers Management Ltd. The market is characterized by perfect competition at present, due to a host of similar shipping service providers, proper access to information on freight rate, and dearth of stifling regulations and other economic factors.
To improve their positions, the industry participants are expending a lot of energy on developing better transportation technologies and carrier models. This, in turn, has helped to contribute to the overall development in the market. Further, ship owners have proper procedures in place to ensure secure and environmentally responsible operations. There are, however, obstacles to entry and exit from the global crude oil carriers market. Steep initial upfront investment to acquire new or second hand carrier ships, for example, makes it difficult for aspiring players to foray into the market.
As per a Transparency Market Research report, the global market for crude oil carriers was valued at US$160 bn in 2015. Exhibiting a CAGR of 3.5% from 2016 to 2024, it is projected to reach US$217 bn by 2023.
Exponential Economic Growth in Asia Pacific Emerging Economies Propels Market
The global crude oil carriers market can be classified on the basis of vessel type into VLCC/ULCC, Aframax, Suezmax, and Panamax. Among them, VLCC and ULCC together accounted for a leading share in the market in 2015 of about 63%. This is because of a substantial number of VLCCs currently operating that far surpass the number of other vessel types.
Geography-wise, the global crude oil carriers market can be segmented into Asia Pacific, North America, Europe, and the rest of the world. Asia Pacific leads the market with maximum share on account of most of the demand for crude oil carriers emanating from the region, particularly China which stores massive quantities of low cost crude oil in spite of its slowing economy. In fact, Japan, China, South Korea, and Malaysia, own and operate majority of the crude oil carriers in the global market. In 2015, the share of Asia Pacific in the market was a sizeable 41%. Besides countries in Asia Pacific, Greece in Europe owns and operates a significant percentage of global crude oil carriers.
Tumbling Crude Oil Prices Drives Market
The demand for crude oil carriers is guided mainly by crude oil production, refining facilities, and consumers of oil products. The report by TMR lists some of the prominent growth drivers in the market. Tanking crude oil prices on account of supply glut and the resultant higher refinery output, according to it, has majorly contributed to the market. Another factor resulting in an upswing in the market is the accelerated pace of globalization and industrialization, fuelling significant economic growth both in developed and developing nations. This has substantially boosted the demand for bulk oil transportation services and facilities, mainly from extraction locations to refineries.
Positive carrier fleet fundamentals as compared to historical averages, along with peaking crude oil stockpiling due to record low prices in OECD and non-OECD regions, is further expected to propel demand for oil carriers in the near future. “Countering the growth in the market are the logistics-related expenses and decreasing demand for oil from regions that are increasing turning to renewable resources for their energy needs,” points out a TMR analyst.
This review is based on the findings of a TMR report titled “Crude Oil Carriers Market, by Vessel Type - Global Industry Analysis, Size, Share, Growth Trends, and Forecast 2016–2024.”
Global Crude Oil Carriers Market, by Vessel Type
Global Crude Oil Carriers Market, by Region
- North America
- Rest of North America
- Rest of Europe
- Asia Pacific
- South Korea
- Rest of Asia Pacific
- Rest of World
- Saudi Arabia
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