Poten & Partners recently shared a compelling outlook in their "Ready For A Rebound" report, suggesting that Very Large Crude Carriers (VLCCs) may be the first beneficiaries of an upcoming tanker market upturn.
Why VLCCs Could Lead the Rebound
Tight orderbook: Only one VLCC was delivered last year, with just six more expected by the end of 2025 - a stark contrast to higher deliveries forecast for mid-size vessels.
Long-haul trade strength: Drewry notes that surging refinery throughput in regions like the Middle East and West Africa, combined with strong export demand from Brazil and Canada, will favor long-haul tonnage, especially VLCCs, over smaller segments.
Economic scale advantage: VLCCs have historically offered lower cost-per-barrel over longer routes, critical as OPEC+ supply rebounds and global oil flows diversify.
What the Data Is Telling Us
Spot rate strength: As of late August, the Baltic VLCC TCE index is trading around $47,300/day, up approximately 41% year-over-year. Analysts at Jefferies project loadings from the Middle East could rise to 160–165 per month in Q4, up from 135/month earlier in 2025.
LatAm to Asia demand surge: Signal Ocean reports that tonne-mile demand from Brazil to China has nearly doubled, adding roughly 1 billion nm to the weekly 7-day average since March. This trend is tightening availability in the Atlantic basin and further supporting VLCC freight momentum.
Summary for Investors
VLCCs are structurally better positioned than ever:
Fleet additions remain limited, preserving tight supply.
Trade patterns are shifting toward longer haul flows, boosting tonne-mile demand.
Spot market fundamentals and loadings suggest pricing power is returning to the largest vessels.
For investors monitoring shipping cycles, VLCC-centric strategies or exposure to freight rate-linked instruments may offer compelling upside as we move into Q4.