OPEC’s crude tanker loadings have seen a significant week-on-week increase of 24%. However, despite this upward trend, it is premature to declare a definitive shift in market dynamics. The continued weak demand from major consumers like China and India has led to total global volumes falling 3.6% below last year’s figures.
Notably, freight rates have not responded to this rise in loadings, largely due to unusually high ship supply in the Persian Gulf during week 23. The recent OPEC+ production increases, amounting to 138,000 barrels per day (bpd) in April and 411,000 bpd in May, have not yet translated into substantial gains in OPEC volumes. Nevertheless, the planned additional production increase of 411,000 bpd for June and July could potentially elevate volumes beyond last year’s levels, providing a much-needed boost to the crude tanker market.
This year, year-to-date seaborne crude oil volumes have been adversely affected by rising global uncertainties, particularly stemming from increased U.S. import tariffs. While U.S. policies remain largely unchanged, some countries have been given a temporary 90-day suspension on reciprocal tariff hikes. Notably, an agreement between the U.S. and China to restore normal trade relations offers a glimmer of hope that this uncertainty may diminish, potentially easing the pressure on oil demand for the remainder of the year.
Should this optimism falter, the anticipated increases in OPEC+ production coupled with lower oil prices could still bolster support for crude tankers. Brent crude prices have hovered consistently below USD 70 per barrel, recently sitting around USD 65. U.S. Energy Information Administration forecasts suggest a further decrease to approximately USD 60 per barrel by late 2025.
This decline in prices could enhance oil demand and drive up global inventories, further supporting seaborne volumes. According to the International Energy Agency, global inventories are projected to increase by 720,000 bpd during 2025. While it remains uncertain whether the recent increase in loadings is indicative of a sustained trend, there is cautious optimism that a combination of increased production, lower prices, and rising inventories could uplift freight rates.
If OPEC crude oil volumes continue to exceed those of previous years, Very Large Crude Carriers (VLCCs), which transport a significant 70% of seaborne exports, may be positioned to gain the most.