Euronav crude oil tanker. Image via CMB Tech
By Dimitri Rhodes
Nov 7 (Reuters) – Belgian oil tanker company CMB Tech says it will focus on the fast growing market in India as it reported third quarter results above market expectations on Thursday, boosted by vessel disposals as it diversifies its fleet.
After last year’s Euronav-Compagnie Maritime Belge takeover, the group shifted strategy by selling 24 tankers to Frontline and acquiring CMB.Tech’s fleet. It now operates a diversified fleet of around 160 vessels, including dry bulk, container, and chemical tankers, rather than focusing solely on oil transport with Very Large Crude Carriers (VLCC) and Suezmax tankers.
CMB Tech shares fell 1.3% at 0817 GMT, extending a 7.1% decline over the past year.
“India is a bright spot, with oil demand forecast to grow by 200 thousand barrels per day in 2024, surpassing China’s incremental demand growth this year,” CMB Tech said.
It acknowledged near-term challenges to oil demand growth in China and the Middle East, adding increased demand in non-OECD Asia will be crucial for balancing the global energy market.
“Geopolitical risks in the Middle East, especially around the Strait of Hormuz, will remain a key watchpoint,” it added.
Many container ships now take a longer route around the Horn of Africa due to attacks by Yemen’s Houthi militants in the Red Sea region, which they call solidarity for Palestinians in Gaza.
CMB Tech reported a 14.4% net profit drop to $98.1 million in the period, surpassing an average forecast of $43.62 million, according to data compiled by LSEG, aided by a $61.4 million gain from the disposal of 2 vessels.
“From a supply-side perspective, the outlook for the tanker fleet remains generally favourable for VLCCs,” the group said in a statement.
It cautioned about the Suezmax segment, where the order book has grown significantly, with an orderbook-to-fleet (OB/F) ratio of 16.3%, more than double that of VLCCs.
“Overall, the CMB.TECH fleet is well-positioned to navigate these evolving global market conditions,” the group added.
(Reporting by Dimitri Rhodes; Editing by Sherry Jacob-Phillips, Clarence Fernandez, Elaine Hardcastle, Reuters)
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