Shipping industry sees used tankers outprice new builds

The maritime shipping industry is experiencing a paradox where used vessels are commanding higher prices than newly built ones in certain segments. Specifically, the price of used oil tankers has risen by 26% since the beginning of the year. For instance, a five-year-old Very Large Crude Carrier (VLCC) was valued at approximately $151 million in late August, roughly 16% higher than the cost of ordering a new build.

This trend is driven by the immediate availability of used ships compared to the multi-year waiting periods required for new constructions. In a market with surging freight rates, the ability to deploy a vessel immediately represents a significant advantage and avoids the high opportunity cost of waiting.

Freight rates have reached record highs. According to the Baltic VLCC TC Average, daily spot income for VLCCs rose from approximately $198,000 in July to $722,946 by September 18, an increase of over 807% compared to the same period last year. On the Persian Gulf-China (TD3C) route, rates peaked at over $1.2 million per day in mid-September.