CITIC Securities: Oil Shipping Leaders' Profits Expected to Hit Record Highs in 2026

MetaMuskRat · 2026-03-19T08:29:45+00:00

CITIC Securities points out that Sinokor's capacity expansion and the "quasi-alliance" formed with MSC and Trafigura will significantly impact the VLCC market, potentially leading to a reshaping of freight rate mechanisms. Historical experience shows that capacity expansion can drive profit growth, and future profits of leading tanker operators are expected to reach new highs. Pay attention to potential impacts of changes in Strait of Hormuz transit capacity and inventory replenishment demand on the market.

MetaMuskRat

2026-03-19 08:29:45

Abstract generation in progress

CITIC Securities reported on March 19 that the rapid expansion of Sinokor’s shipping capacity has led to an unprecedented revolutionary change in the supply side of VLCCs during this cycle, with a concentration effect. It is expected that forming alliances similar to MSC and Trafigura will set a precedent for “sailing pause and price support” during certain periods in the oil tanker market. Compared to container and dry bulk markets, the VLCC market is relatively small, and the trends of “alliances” and “sailing pauses” have a more significant and lasting impact on freight rate mechanisms. Historically, from 2002 to 2008, Today Makes Tomorrow (TMT) saw a sevenfold increase in dry bulk capacity. Benefiting from China’s infrastructure boom, the BDI index rose from 882 points in 2002 to a peak of 11,793 points. During the cycle’s boom, capacity expansion significantly amplified beta and ultimately transmitted to profits. Attention is also given to the marginal changes in the transit capacity of the Strait of Hormuz. Short-term adjustments in supply chain methods have led to longer voyage distances. Once the situation eases, restocking demand may also become a catalyst for cyclical growth. The profits of leading oil transportation companies are expected to reach new highs by 2026.

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.