Half-Yearly Review and Outlook for the Global Tanker Shipping Market in 2025!
Abstract: In the first half of 2025, global economic demand was sluggish, inflation decelerated, and international trade fluctuations intensified. Factors such as geopolitical events, the OPEC+ oil policy, increased oil exports from non-OPEC+ countries, and escalating sanctions against Russia by Europe and the United States intertwined, exerting varying degrees of impact on the international tanker shipping market. The growth rate of global oil consumption demand decelerated, and international oil prices fluctuated downward. The overall performance of the tanker shipping market fell short of expectations, with freight rates for representative routes of various ship types declining to varying extents compared to the same period in 2024. Notably, the crude oil tanker shipping market outperformed the product tanker shipping market. Looking ahead to the second half of the year, the overall revenue of the global tanker shipping market is expected to decline, and a concentrated period of ship deliveries is approaching, which will negatively affect the supply-demand fundamentals. The specific performance of the market is significantly influenced by macroeconomic factors and geopolitics, leading to increased uncertainty. Institutions generally anticipate that international oil prices in 2025 will decline compared to 2024.
Keywords: tanker transportation; tanker capacity; tanker freight rates; oil demand; oil supply; international oil prices
In the first half of 2025, the international tanker shipping market experienced significant fluctuations. Looking ahead to the second half of 2025, multiple factors will continue to impact the international tanker shipping market, presenting both challenges and opportunities. Overall, the performance of the international tanker shipping market in 2025 is expected to fall short of expectations, with varying degrees of decline.
I. Review of the global tanker shipping market in the first half of 2025
In the first half of 2025, the overall performance of the global tanker shipping market fell short of expectations, with earnings for all ship types declining compared to the same period in 2024. In terms of demand, global oil maritime trade and ton-mile demand saw slight growth in the first half of 2025 compared to the same period in 2024. On the supply side, except for VLCCs (Very Large Crude Carriers), the delivery of new ships for other ship types rebounded, and the overall tanker fleet capacity maintained low-speed growth.
(I) Spot market
In terms of crude oil tankers, the VLCC market remains relatively robust. Market concerns arising from the conflict between Iran and Iraq have led to a rapid surge in VLCC freight rates in the short term. Furthermore, as OPEC+ member countries gradually withdraw from voluntary production cuts, crude oil production has increased, driving demand for VLCC capacity in the Persian Gulf region. The average daily earnings for the representative route, Middle East-Far East (TD3C), in the first half of 2025 stood at USD 40,374 per day, a slight decrease of 2% compared to the same period in 2024. After a slight decline in 2024, freight rates for small and medium-sized tankers further declined in the first half of 2025. The Suezmax tanker market experienced a surge in excess capacity due to the large number of new deliveries, coupled with weak demand from European refineries due to low operating rates, leading to a decline in freight rates. The trend for the Aframax tanker market was largely consistent with that of the Suezmax market, as weak operating rates in Western refineries reduced their utilization, resulting in a significant drop in freight rates. Specifically, the average daily earnings for the representative route of Suezmax tankers, West Africa-Europe (TD20), and Aframax tankers, Middle East-Singapore (TD8), decreased by approximately 16% and 30% respectively compared to the same period in 2024.
Regarding product tankers, the product tanker transportation market faced significant pressure in the first half of 2025. Due to an increase in new ship deliveries and stagnant freight demand growth, the imbalance between ship supply and demand was worsening, leading to a notable decline in freight rates. The average daily earnings for representative routes of various ship types fell sharply compared to the same period in 2024, with the decline being around 50% for each type. In summary, the daily earnings of various ship types in the international tanker transportation market fell to varying degrees in the first half of 2025. The crude oil tanker transportation market performed better than the product tanker market, with the VLCC market experiencing the smallest decline. The average daily earnings for various product tanker market segments fell sharply, with the MR ship type experiencing the largest decline, down about 53% compared to the same period in 2024. The average daily earnings for representative routes of various tanker ship types from January to June 2025 are shown in Table 1.
(II) Global oil trade
1. Crude oil trade
In terms of imports, Asia's imports continued to grow in 2025, while westward trade continued to shrink. In the first half of 2025, against the backdrop of continuous contraction in western crude oil imports, Asia remained the main driver of global crude oil import growth; the expansion of China's refining capacity, coupled with the continuous increase in operating rates of refineries in other parts of Asia, drove good growth in crude oil imports in the region. Due to the low operating rates of refineries in Europe, the westward flow of crude oil continued to shrink, and the slowdown in domestic oil demand, coupled with the surge in refining activities in Africa, impacted refining activities in Europe in 2025, thereby compressing crude oil imports in the region. Meanwhile, the increase in refining activities in Latin America and Mexico suppressed the export of refined oil products from the United States, reduced the refining operating rate in the United States, and further reduced crude oil imports in the United States. In terms of exports, the growth in crude oil exports from the Americas will significantly offset the decline in exports from the Middle East. In the first half of 2025, crude oil exports from the Middle East and Africa continued to decline, while the main growth in exports came from the Americas. With the continuous increase in refining activities in the Middle East, and crude oil production remaining stable, the available crude oil for export further decreased. In the first half of 2025, crude oil exports from Africa further decreased. Despite a rebound in crude oil production in the region, the increase in refining activities offset the export growth brought about by the production increase.
2. Refined oil trade
Affected by weak oil demand and rising geopolitical risks, the total trade volume of refined oil products contracted in the first half of 2025, and trade flows continued to be reshaped. According to KPLER data, the volume of refined oil product seaborne trade decreased by 4.5% in the first half of 2025.
In terms of imports, policy and energy transformation have become the core forces driving the restructuring of trade flows. Europe's transportation demand for diesel imports from the United States remains stable, and it has increased its procurement of diesel from the Middle East and India. Indonesia has announced a ban on the import of refined oil products from Singapore within six months, shifting to procurement from the United States and the Middle East. Due to the commissioning of refineries in West Africa, the demand for refined oil imports continues to decline.
In terms of exports, the sluggish demand for gasoline and diesel has hindered the growth of refined oil product (ROP) seaborne trade volume. From January to June 2025, China's ROP exports declined by over 10%, with gasoline and diesel exports plummeting; ROP exports in Northeast Asia fell by more than 12%. Russia's ROP exports remained stable in the first half of 2025, with Türkiye remaining its largest buyer of petroleum products. Despite intensifying trade frictions, US diesel exports to Latin America have remained robust. Furthermore, with its expanding refining capacity, India has become the world's largest exporter of ROP, and the growing demand in African and Asian markets will further support India's ROP exports.
(III) Capacity structure
According to Clarksons' data, in the first half of 2025, there were a total of 5,787 vessels with a carrying capacity of over 10,000 dwt in the global tanker fleet, amounting to 656 million dwt, with an average age of 13.8 years.
Regarding newbuilding deliveries, a total of 110 tankers, amounting to 8.48 million dwt, were delivered from January to June 2025, marking a year-on-year surge of 140%. Among them, LR2, Aframax, and MR tankers constituted the majority of deliveries.
In terms of ship scrapping, in the first half of the year, only 22 oil tankers, totaling 1.86 million DWT, were scrapped globally.
Regarding retrofitting and upgrading, the proportion of tankers equipped with desulfurization towers in the global tanker fleet stands at 28%. Specifically, the installation rate of desulfurization towers for VLCCs accounts for 60% of their fleet size, while for ECO tankers, it accounts for 34% of the global tanker fleet size.
(IV) International oil price
In the first half of 2025, international oil prices fluctuated downward due to a combination of factors, including expected supply and demand fluctuations, accelerated production increases by OPEC+, the conflict between Iran and Iraq, and Trump's tariff policy. Specifically, in January 2025, before his departure from office, Biden initiated a new round of sanctions against Russia. Market expectations of tight supply led to international oil prices reaching their highest point of the year in January. Subsequently, Trump returned to office and announced additional tariffs. The market feared that these measures would hinder the global economy and weaken oil demand. Coupled with OPEC+ announcing a production increase plan in May, market expectations of oversupply intensified. Oil prices began to fall from their highs and hit two lows during April and May, with a decline of over 30% compared to the highs reached in January. In June, the conflict between Iran and Iraq erupted, driving crude oil prices to rebound sharply. Brent crude oil prices once rose to a high of $78.85 per barrel, then continued to fluctuate before moderately falling due to the easing of tensions. The trend of international crude oil prices in the first half of 2025 is shown in Figure 1.
Overall, global oil prices experienced significant fluctuations and a downward trend in the first half of 2025. The average prices of Brent and WTI (West Texas Intermediate) crude oil futures both hit their lowest semi-annual levels in three years, approximately $70.74/barrel and $67.5/barrel, marking a decrease of approximately 15.2% and 14.3% compared to the same period in 2024.
II. Future Outlook for the Global Tanker Shipping Market
It is expected that the overall revenue of the global tanker shipping market in 2025 will decline compared to 2024. In terms of demand, global oil demand will continue to grow, but the growth rate will significantly slow down. In terms of supply, in the second half of 2025, except for VLCC tankers, other small and medium-sized tankers will undergo concentrated delivery, which will have a negative impact on the fundamental supply and demand of shipping capacity. In terms of freight rates, the market fundamentals of VLCC tankers in the crude oil tanker market are relatively optimistic, and freight rates are expected to remain high, while the revenue of Suezmax and Aframax tankers will decline; the overall revenue of the product tanker market will decline significantly compared to 2024.
(I) Macroeconomics
1. Global economy
The United Nations, the World Bank, the International Monetary Fund (IMF), and other institutions have successively lowered their global economic growth forecasts for 2025. The "World Economic Situation and Prospects 2025" released by the United Nations points out that the global economic growth rate is expected to slow down to 2.4% in 2025, compared to 2.9% in 2024, which is 0.4 percentage points lower than the forecast in January; the latest "Global Economic Outlook" released by the World Bank in June has lowered the global economic growth forecast for 2025 from 2.7% in January 2025 to 2.3%; the latest "World Economic Outlook Report" of the IMF has lowered the global economic growth forecast for 2025 to 2.8%, which is 0.5 percentage points lower than the forecast in January 2025. The reports released by these major economic institutions all emphasize that the current global economy is entering a critical period and facing many uncertainties, especially the tariff policy of the Trump administration in the United States, which will weaken the global economic growth prospects.
2. Chinese economy
In the first half of 2025, China's economic performance exceeded expectations, showing steady progress. Recently, several foreign institutions such as Citibank, UBS Group, Goldman Sachs, and JPMorgan Chase have raised their forecasts for China's economic growth rate in 2025, believing that the momentum driving China's economic development continues to strengthen, and this positive trend is expected to persist in the second half of the year. 2025 marks the end of China's 14th Five-Year Plan, and China will implement more proactive macroeconomic policies, including a more aggressive fiscal policy and a moderately loose monetary policy. Despite increasing downward pressure on the economy, China's economic growth rate target for 2025 remains around 5%.
(II) Main factors affecting the future trend of the oil transportation market
1. Sanctions against Russia
The escalation of sanctions imposed by Europe and the United States on Russia may prompt owners of LR tankers to shift towards crude oil transportation. This shift is expected to alleviate the current oversupply situation in the LR tanker market in the short term, supporting freight rates, especially in the context of anticipated tight supply in the Aframax tanker market. In order to maintain its refined oil export capacity, Russia may continue to purchase ships that are not subject to sanctions. This behavior will limit the downward space of second-hand ship prices, providing some support to the second-hand ship market. In the second half of 2025, if sanctions imposed by Europe and the United States on Russia are eased, short-haul trade between Russia and Europe will pick up, and long-haul transportation demand will decrease, thereby adversely affecting the ton-mile demand and freight rates in the tanker transportation market.
2. Red Sea Crisis
If the crisis in the Red Sea is resolved in the second half of 2025, it may bring about another change in the trade pattern. The resumption of normal navigation through the Suez Canal will have a negative impact on the overall ton-mile demand for tanker transportation, but different ship types will be affected differently: medium-sized tankers will regain the cargo volume previously lost to VLCCs due to routing around the Cape of Good Hope, and this increase in cargo volume will offset the negative impact of the shortened voyage to some extent. However, this shift in cargo volume to medium-sized tankers will weaken the demand for VLCC capacity. In addition, the resumption of normal shipping routes will reduce the demand for long-distance transportation due to routing around, thereby weakening the ton-mile demand for product tankers. However, due to the frequent violations of the ceasefire agreement by the Houthis, shipowners may still be reluctant to return to the Suez Canal, so it will take time for normal navigation to resume.
3. OPEC+ oil policy
The OPEC+ member countries recently decided to gradually increase oil production, which may lead to a sustained oversupply in the oil market in 2025. Against this backdrop, it is expected that oil prices will remain weak, encouraging major consuming countries (especially China) to conduct restocking operations, thereby boosting demand for VLCC ship types. If OPEC+ continues to implement production increase measures in the second half of the year, it will lead to oversupply and trigger a sharp decline in oil prices. In this case, the surge in onshore and floating storage capacity will provide support for the rental levels in the crude oil tanker market. However, it is not ruled out that OPEC+ may cancel the production increase measures in the second half of 2025, as the continued downturn in oil prices will force the alliance to resume production cuts to maintain market balance.
4. The newly issued environmental regulations by the International Maritime Organization (IMO)
The newly issued environmental regulations by IMO may trigger a wave of ship scrapping. The new regulations may accelerate the scrapping of old ships, especially when the compliance costs are high. The increase in ship scrapping will tighten the tanker capacity market and support rental levels.
5. Sino-US trade war
Economic development, geopolitical uncertainties, and supply-side concerns will lead to significant fluctuations in the oil shipping market. Although the current Sino-US trade war has not directly affected the demand for tanker transportation (due to the very small bilateral trade volume of crude oil between China and the United States), any negative impact of the trade war on global economic growth will indirectly suppress global oil demand, thereby weakening oil trade activities. At the same time, any positive developments in the Sino-US trade war will boost global economic activity and oil demand, thereby increasing global trade volume and ton-mile demand for crude oil tankers.
6. Trump administration's tariff policy
The Trump administration's tariff policy is one of the most significant variables affecting the tanker shipping market in 2025. The increase in US tariffs will dampen global economic activity and oil demand, thereby reducing global oil trade volumes and tanker shipping demand.
7. Trans Mountain Expansion (TMX) pipeline in Canada
Since the expansion of the TMX pipeline in Canada at the end of May 2024, crude oil exports from the west coast of Canada have been completely released, with an average export volume of 350000 to 400000 barrels per day. According to data, about 10% of the global Aframax tanker capacity will be active in the Far East and Pacific region in the long term. In the second half of 2025, if the Canadian TMX pipeline is delayed in achieving full load operation due to operational bottlenecks, the offshore export of Canadian crude oil will be suppressed, and the demand for Aframax tanker capacity will decrease.
（3） Global oil supply and demand
1. Oil demand
It is expected that global oil demand will continue to grow in 2025, but the growth rate will significantly slow down. Affected by the escalating trade friction between China and the United States, the global economic recovery is facing uncertainty, and industrial activity and energy consumption are being suppressed. Therefore, the market has lowered its expectations for global oil demand growth by 2025. The increase in trade barriers, tariff hikes, and supply chain adjustments have to some extent weakened the growth momentum of crude oil consumption, especially in key areas such as manufacturing and transportation. In addition, trade tensions may also trigger financial market volatility, further affecting the confidence and spending behavior of businesses and consumers, thereby having a long-term negative impact on oil demand growth. The Drewry report lowered the expected oil demand growth for 2025 from the previously forecasted 1.1% to 0.7%, which is lower than the growth level in 2024; It is expected that global oil demand will increase by 1.05 million barrels per day by 2025, reaching an average of 104 million barrels per day, as shown in Figure 2. The countries with the highest growth in oil demand will be some developing countries in Asia, Africa, and Latin America. However, the demand growth forecast for this region in 2025 has been lowered from the previous 3.0% to 2.2%. Similarly, China's expected oil demand growth in 2025 is only 160000 barrels per day, lower than the previously predicted 220000 barrels per day.
2. Oil supply
On July 11, 2025, the International Energy Agency released its monthly crude oil market report, which raised its forecast for total crude oil supply in 2025 from 104.9 million barrels per day to 105.1 million barrels per day. OPEC predicts that crude oil supply will increase by 1.6 million barrels per day by 2025, mainly from countries such as the United States and Canada. The significant increase in crude oil production from non OPEC+member countries is reshaping the oil market landscape. In April 2025, OPEC+decided to gradually lift the voluntary production reduction plan of 2.2 million barrels per day since November 2023 and increase production targets twice. This measure may exacerbate the tense situation of oversupply, leading to a supply surplus of 730000 barrels per day in the global oil market. If OPEC+continues to increase production in the second half of 2025, the surplus can reach 1.4 million barrels per day.
3. Global Energy Refining
The weak growth in oil demand weakens the expected growth in refining activities. The Drewry report shows that global refinery production is expected to increase by only 400000 barrels per day in 2025, lower than the previously predicted 750000 barrels per day. Among them, the closure of refineries in OECD countries (especially in Europe and the United States) will result in a production capacity loss of approximately 618000 barrels per day, thereby reducing the refinery operating capacity of these countries; The improvement of refining capacity in Asia and the Middle East will drive a 0.5% year-on-year increase in global refining volume by 2025. Thanks to the continuously improving refining capacity, China's refining operations are expected to increase by about 300000 barrels per day, especially with the second 10 million t/year atmospheric and vacuum distillation unit of Shandong Yulong Petrochemical Phase I being put into operation by the end of March 2025, providing support for this growth. However, due to the ongoing trade war and sanctions on local refineries in China, domestic oil demand is sluggish, which will limit the increase in China's total refining capacity.
（4） Supply and demand of global oil tanker transportation market capacity
Supply and demand of crude oil tanker capacity. Clarksons predicts that the total demand for crude oil tanker capacity in 2025 will be about 330 million deadweight tons, a year-on-year increase of 0.8%, and the total supply of capacity will be about 440 million deadweight tons, a year-on-year increase of 0.6%. The demand growth rate is greater than the supply growth rate, and the supply and demand fundamentals will remain stable; There is still excess capacity, with total supply exceeding total demand by approximately 108.9 million deadweight tons. Among them, the excess supply of VLCC, Suezmax, and Aframax ship types is 75.6 million, 16.5 million, and 16.8 million deadweight tons, respectively.
Supply and demand of refined oil tanker transportation capacity. Clarksons predicts that the total demand for refined oil tanker capacity in 2025 will be about 120 million deadweight tons, a year-on-year decrease of 0.9%, while the total supply of capacity will be about 190 million deadweight tons, a year-on-year increase of 4.8%. The growth rate of capacity supply is much higher than that of demand; There is still excess capacity, with total supply exceeding total demand by approximately 74.2 million deadweight tons. Among them, the excess supply of LR2, LR1, MR and below ship types is 22.1 million, 7.5 million, and 44.6 million deadweight tons, respectively.
（5） Various types of transportation markets
1. Crude oil tanker transportation market
Overall, by 2025, it is expected that the rental level of crude oil tankers will decline comprehensively, as weak growth in capacity demand will drag down their utilization rate against the backdrop of accelerated growth in capacity supply. The asset prices of crude oil vessels will also be dragged down by the sluggish charter market, leading to a decline. Despite the bleak long-term demand outlook, due to the severe aging of the fleet and the need to replace capacity, it is expected that the booking activity in the original oil tanker market will remain strong in the coming years.
The market will show differentiation throughout 2025, and the VLCC ship market may perform better than small and medium-sized ships. In 2025, weak demand coupled with the concentrated delivery of new Suezmax and LR tanker fleets will increase the supply of capacity in the small and medium-sized tanker market, thereby lowering freight rates. In addition to the low operating rates of refineries in Europe and the United States, the reduction in crude oil export surplus in Nigeria and Mexico may also lead to a decrease in short distance transportation volume, which will further suppress demand for medium-sized oil tankers. However, strong transatlantic trade will to some extent support the demand for Suezmax and Aframax tankers. In the second half of 2025, against the backdrop of stagnant fleet size, the strong growth in demand for transportation capacity will continue to maintain the high utilization rate of VLCC. Despite weak growth in oil demand, VLCC demand will remain strong due to increased long-distance transportation trade from the Americas and the Middle East to Asia. In addition, in the context of OPEC+production increase and lower fuel prices, higher operating rates of refineries and possible increased crude oil reserve activities will drive the growth of Asian crude oil imports.
In terms of VLCC ship types. The VLCC market is expected to perform better than small and medium-sized oil tankers in 2025, mainly due to a better supply-demand balance. Despite sluggish global crude oil demand growth, VLCC capacity demand is expected to grow faster than other vessel types, mainly due to the expected increase in long-distance crude oil trade from west to east. On the demand side: Long distance crude oil trade to Asia is expected to increase by 2025, which will boost VLCC demand. Due to the increase in refinery operating rates in the Asian region, it is expected that the volume of imported crude oil trade in Asia will continue to increase; The growth in global crude oil production mainly comes from the Americas, so the trade of crude oil from the United States and Latin America to Asia will increase. As Canada transports more crude oil through the TMX pipeline, it is expected that its crude oil exports to Asia will also increase, which will benefit the VLCC and Aframax tanker markets. In addition, OPEC+production measures will also boost the demand for VLCC capacity in the Persian Gulf region. Supply side: The moderate delivery volume will limit the growth rate of VLCC fleet. Drewry predicts that the VLCC fleet will shrink slightly by 0.6% in 2025, with only one VLCC delivered in the first quarter and an estimated five deliveries for the remainder of the year, mainly due to low VLCC order volumes in 2021-2022. It is expected that ship dismantling activities will remain sluggish, as shipowners will postpone the dismantling of old ships in the context of limited new ship deliveries and attractive freight rates, resulting in a stable VLCC fleet size.
In terms of Suezmax ship type. Against the backdrop of increased transportation capacity supply, the sluggish operating rates of Western refineries will drag down freight rates, leading to a further decline in market revenue. On the demand side, the weak operating rate of European refineries will become the main drag on the Suezmax market in 2025; The decline in European crude oil imports mainly comes from West Africa and the Middle East, which will reduce the demand for Suezmax tankers. In addition, the Red Sea crisis has led to longer shipping routes, increased transportation costs for Middle Eastern crude oil, and weakened Europe's demand for Middle Eastern crude oil. Similarly, the possible reduction in West African crude oil exports to India will also have a negative impact on Suezmax demand. Supply side: Among all types of oil tankers, Suezmax has the fastest growing fleet. Drewry expects the Suezmax fleet size to grow by 4% by 2025, with an estimated 26 new ships joining the fleet; Higher new ship deliveries will occur in sync with the increase in ship dismantling activities, as the volume of ship dismantling is expected to rebound after a slump in the past two years.
In terms of Aframax ship type. The Aframax market revenue is expected to decline as weak operating rates in Western refineries will lower the utilization of oil tankers. On the demand side: The weak operating rate of European refineries is not conducive to the medium-sized oil tanker market, but if the transportation demand on the transatlantic route (America Europe) remains strong, it will bring some breathing space for Aframax shipowners. However, if the Red Sea crisis is resolved, Europe's imports of crude oil from the Middle East will increase, replacing some of the US crude oil imports, which will suppress the demand for Aframax tankers on transatlantic routes. The recent rebound of Russian crude oil transported by non sanctioned vessels is positive for the Aframax market. In addition, the increase in TMX pipeline flow will expand the scale of Canadian crude oil exports by sea to the West Coast of the United States and Asia, which will support the demand for Aframax tankers. On the supply side, fleet growth is gradually slowing down due to the speed of ship dismantling exceeding the delivery of new ships. Drewry predicts that the Aframax fleet will only grow by 0.7% in 2025, with plans to deliver only 8 new ships throughout the year; And about 27% of the ships in the fleet are over 20 years old (the highest proportion among all types of oil tankers), and the growth of the fleet will slow down or even decline after 2026 due to a significant increase in the number of dismantled ships.
2. Finished oil tanker transportation market
The refined oil tanker transportation market will face increasing pressure, and revenue is expected to decline significantly, especially in 2025 and 2026. The surge in new ship deliveries coupled with stagnant transportation demand growth has led to a much higher growth rate in capacity supply than demand, and the imbalance between supply and demand of finished oil tankers is worsening. Meanwhile, the demand for ton nautical miles is expected to increase by only 0.7% between 2024 and 2030. In the next three years, strong orders will drive fleet capacity growth, leading to a decrease in freight rates. In addition, the improvement of the Suez Canal navigation and the settlement of the Russia-Ukraine conflict will further reduce the demand and revenue per ton of sea mile in the refined oil transportation market.
Regarding LR ship types. The freight revenue of LR type oil tankers is expected to decline in 2025, as a large number of new ships will be delivered in 2023-2024, leading to an influx of capacity into the market and a decrease in vessel utilization. On the demand side: Due to the flexible entry of LR type oil tankers into the Aframax market, in 2025, the US and Europe will continue to expand their sanctions list against Russian oil tankers, leading to a tightening of the Aframax market capacity and prompting some ship owners to shift their LR type oil tankers to crude oil transportation, which will support their freight rates in the short term. In addition, the rising demand for naphtha will continue to provide support for the LR market. However, in West Africa, as the processing capacity of Dangote refinery increases, it is expected that gasoline imports will decrease, thereby suppressing the demand for LR type tankers. The decline in diesel demand in Europe and any rebound in Suez Canal traffic could shorten the distance traveled, further reducing LR tanker shipping costs. Supply side: Drewry expects the LR fleet to expand by 4.3% in 2025, mainly driven by the delivery of a large number of newly built LR2 tankers. The LR tanker market is undergoing structural changes, with LR2 continuing to dominate growth and LR1 experiencing a rebound in new ship deliveries after years of silence; Although future ship dismantling activities will put pressure on the size of the LR1 fleet, the overall LR fleet capacity will still expand.
In terms of MR ship type. Due to the increase in new ship deliveries and weak demand in the next two years, it is expected that the freight revenue of MR type oil tankers will decline in 2025. On the demand side: The demand for gasoline in the United States has gradually decreased due to the increase in electric vehicle sales, resulting in a decrease in the transportation volume of European to American routes. With the Dangote refinery in Nigeria fully operational by 2025, European refineries will face more severe competitive pressure. Once the Olmeca refinery in Mexico is fully operational by 2026, US exports to Latin America will gradually decline, and market demand will decrease. However, the demand for MR type oil tankers in the area east of the Suez Canal is expected to perform slightly better in 2025. The increase in processing capacity of refineries in China and India will also promote intra Asian refined oil trade, further driving demand for MR type tankers. Supply side: Drewry predicts that the MR fleet will grow by an average of 3.1%, with a significant increase in new ship deliveries. However, due to sluggish ship dismantling activities, the supply and demand levels of transportation capacity will remain surplus.
（6） International oil price forecast
In the second half of 2025, the trend of international oil prices is mainly influenced by supply and demand fundamentals, macro factors, and geopolitical factors. On the demand side: Although the peak season is still expected, trade pressure and slowing global economic growth have dragged down substantial demand. Due to the continued escalation of trade frictions between China and the United States, global economic recovery is facing uncertainty, and industrial activity and energy consumption are being suppressed. In addition, trade tensions may also trigger financial market volatility, further affecting the confidence and spending behavior of businesses and consumers, thereby having a long-term negative impact on oil demand. Therefore, the market has lowered its expectations for global oil demand growth by 2025. On the supply side: In May 2025, OPEC+will accelerate production increases, exacerbating oversupply. The rise in oil production in non OPEC+countries, driven by the United States, Canada, Brazil, and Guyana, will pose a downward risk to international oil prices. On a macro level, the risk of global economic uncertainty continues to increase, the outlook for oil demand is bleak, and weak economic growth will put pressure on the upward trend of oil prices. In addition, there are dual economic and financial risks in the United States, and the debt problem remains severe, with limited room for the Federal Reserve to cut interest rates. In terms of geopolitics, multiple factors such as the direction of the Russia Ukraine situation, the Red Sea crisis, Trump's tariff policies, and European and American sanctions will lead to greater fluctuations and uncertainties in the oil price trend in the second half of 2025. It is expected that the average Brent crude oil price in 2025 will be between $65 and $70 per barrel, lower than the average level in 2024.
