Phase 1 Trade Agreement Implications
Since the signing of the “Phase 1” trade deal between the US and China, the latter has been gradually removing tariff barriers on imports of products and services included in the deal. In the latest announcement from the country earlier last week, China said it is ready to accept applications for tariff exemptions for close to 700 products originating from the US. Liquified natural gas and crude oil were mentioned among those products. This is seen by some as a sign that China is intending to make good on their Phase 1 promise to buy close to US $200 billion worth of US products and services within the next two years, including US $52.4 billion in additional energy purchases from a baseline of US $9.1 billion in 2017. Should China execute the agreement, is it logical to expect VLCC ton-mile demand to increase. However, there are uncertainties throughout the entire process.
COVID-19 Impact on Crude Oil Demand
On the freight side, latest data suggested that the virus spread will reduce Chinese crude oil demand by a total of 18 VLCC equivalent loadings in the February-April fixing window. It remains to be seen if there will be a sharp recovery after the infection comes under control, althought that would likely not come earlier than halfway through the second quarter.
Tanker Market Outlook
- Global Outlook Themes
- Tanker Tonnage Demand/Supply
- Tanker Market Technicals
- Previous Freight Market Performance
- Freight Rate and Earnings Outlook
- Time Charter Rate Forecast
- Crude and Bunker Price Development
- Asset Market & Investment Projects
- Analytical Appendix
- Over 200 Figures/Tables