NAT reports strong results as tanker upswing continues
Nordic American Tankers reports it currently is experiencing the strongest tanker market that it has seen in decades. During the third quarter, in its fleet of 23 suezmaxes, 21 are in the short term market, providing immediate benefit for NAT.
“The fourth quarter is building a strong momentum for 2020. We expect this to continue,” said the company. “Political frictions often lead to a stronger tanker market.”
“About 70 per cent of the spot trading days of our fleet for 4Q19 have been booked at an average TCE of $34,000/day. Spot rates are continuing its upward momentum. The Time Charter equivalent (TCE) for our ships for the third quarter came in at $15,900/day, which was better than both the second quarter this year at $14,800/day and the third quarter last year that saw $12,000/day.”
Important structural changes stimulating demand for NAT’s suezmax tankers are taking place. New rules by the International Maritime Organization (IMO) coming into force on January 1, 2020 is one change. Oil exports from USA is another important factor. “We see increased crude oil volumes and longer sailing distances, creating more transportation work for our vessels,” said NAT in its report.
Investors and lenders are reluctant to inject capital into private companies undertaking speculative ordering of ships –which is not part of a fleet renewal. This limits supply of ships, which is good for tanker owners and increases the attractiveness of NAT as a publicly listed company.
Year-on-year the trend has continued with better earnings in 2019 versus 2018, confirming that the tide for the tanker market has definitely turned. For the first nine months of 2019, NAT had a net loss of $23.1 million compared to the same period in 2018 that saw a net loss of $84.8 million.
“The NAT strategy is built on expanding and maintaining a homogenous and top quality fleet, leveraging on our industry network and close customer relationships with major oil companies. Employment of our ships with major oil companies is a priority.”
For more information visit www.nat.bm
2nd December 2019
