At the start of 2009, 844 tankers (of 10,000 dwt and above) of 64.3m dwt were scheduled to be delivered within the year. However, the economic downturn impacted not only the availability of finance but also global oil demand which at the start of 2009 was estimated to fall by over 2m bpd. These conditions, allied to the very large orderbook, presented both shipowners and shipyards with problems, and during 2009 tanker deliveries began to slip behind schedule.

What’s The Rate?

Taking the orderbook for 2009 delivery as it was scheduled at the start of 2009, and comparing it to the actual deliveries recorded in the year, it is possible to derive ‘non-delivery’ rates. Although some of the ‘non-delivery’ may be due to statistical reporting delays, in the main it reflects delay and slippage of deliveries and cancellation of orders.

Overall it is estimated that 25% of the tanker dwt capacity originally scheduled for delivery in 2009 did not enter the fleet during the year. The Graph of the Month shows the ‘non-delivery’ rates by sector. The small product tankers saw the greatest degree of slippage and cancellation, with 50% of capacity scheduled for delivery failing to join the fleet in 2009. Amongst the larger sectors the Suezmaxes and Panamaxes saw the highest degree of non-delivery, 33% and 30% of scheduled dwt respectively.

Numbers Game

The picture is just as clear in terms of ship numbers. Of the 68 VLCCs expected to be delivered in 2009 at the start of year, only 54 were recorded. In the Suezmax sector, with a few more vessels on order at ‘greenfield’ yards, of the 69 ships due to be delivered in 2009 only 46 hit the water. 108 Aframaxes were originally scheduled to be delivered, and up until the final quarter actual deliveries were running ahead of schedule. However, a slowdown at the end of the year saw only 96 delivered over the full year.

Slipping Ahead

With a further year of heavy deliveries scheduled anyway, and a significant chunk of the tanker capacity due in 2009 now scheduled to join the fleet this year, the orderbook for 2010 delivery looks more daunting than ever. The tanker orderbook at the start of February 2010 included 58.8m dwt for delivery in the remainder of the year. Even though the vast majority of vessels have been contracted at established yards with proven track records of delivery (though a large order for Suezmaxes at a greenfield Chinese yard distorts the overall picture), there must exist the strong possibility that a significant share of the total, for technical or commercial reasons, will not be delivered within 2010 (48.3m dwt was in delivered in 2009).

Moreover, expectations, although varying significantly, would suggest that cancellation of orders may increase in 2010. These were limited to 3% of scheduled deliveries in 2009, but with ships on order for 2010 less likely to have had finance fully arranged prior to the downturn, this factor may well increase. This only serves to emphasise the clear message – the orderbook schedule today is not a reliable guide to the timing of future deliveries. Fleet forecasters beware!