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Red Sea Diversions Add Tightness to Tankers: Goldman Sachs

OIL
Energy BulletsCommoditiesGoldman Sachs Market News

Diversions away from the Red Sea due to Houthi attacks have triggered renewed price spikes in refining and freight markets, Goldman Sachs analysts said in a note, cited by Bloomberg.

  • “We expect the structural bull markets in refining and oil tankers to continue,” the note said.
  • “The regional mismatch between the sources of future supply growth in the Americas and demand and refining capacity growth in Asia and the Middle East will provide another structural tailwind to oil tanker markets, and indirectly to refining markets,” it added.
  • According to GS, the net fleet capacity growth is near zero in the coming years.
  • GS also expect refinery capacity growth to remain in line with refined product demand growth during 2024-2025. Dec-Dec capacity growth is seen at 0.9m b/d in 2024 and 1.45m b/d in 2025.
  • GS expect refining margins to remain supported until EV penetration scales significantly in the late 2020s.
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Diversions away from the Red Sea due to Houthi attacks have triggered renewed price spikes in refining and freight markets, Goldman Sachs analysts said in a note, cited by Bloomberg.

  • “We expect the structural bull markets in refining and oil tankers to continue,” the note said.
  • “The regional mismatch between the sources of future supply growth in the Americas and demand and refining capacity growth in Asia and the Middle East will provide another structural tailwind to oil tanker markets, and indirectly to refining markets,” it added.
  • According to GS, the net fleet capacity growth is near zero in the coming years.
  • GS also expect refinery capacity growth to remain in line with refined product demand growth during 2024-2025. Dec-Dec capacity growth is seen at 0.9m b/d in 2024 and 1.45m b/d in 2025.
  • GS expect refining margins to remain supported until EV penetration scales significantly in the late 2020s.