The tanker sector is extremely cyclical, for which 2019 provided ample evidence. After a positive start, the market dived. The reason was the global political unrest, as well as the USA’s sanctions against Venezuela. Another contributor was the IMO (International Maritime Organization)’s new regulations for the sulphur content of bunker oil, which in 2020 is limited to maximum 0.5 per cent. ”To a great extent, this entailed that stores were reduced, instead of transport of new products. The market did not recover until the end of the year, which affected our profitability,” says Erik Hånell Managing Director of Stena Bulk.

The forecasts for the tanker market indicates a strong market for 2020, with a limited supply of vessels, and increased demand. According to Erik Hånell, Stena Bulk is well-positioned in this respect, and takes a positive view of 2020. The cooperation with the Angolan oil company, Sonangol, on the commercial operation of Suezmax vessels, continues to perform better than competitors.

In October 2019, Stena Bulk announced a joint venture with Swiss Proman Shipping; Proman Stena Bulk Limited. Immediately thereafter, the first joint initiative was announced: an order from Chinese Guangzhou Shipyard International for two methanol tankers. The first vessel will be ready in 2022. With this order, Stena Bulk is setting a new course with its first methanol-propelled vessels.

During the year, ten IMOIIMAX, five Suezmax and one tanker in the MR-class (medium range) were equipped with scrubber facilities to fulfil the IMO’s new sulphur directive. The total investment amounts to MUSD 55 and includes equipment, installation and costs for the time when the vessel is not in operation. The repayment term for the investment is between two and three years, which has already been hedged by locking future fuel prices. ”By installing scrubbers we’re ensuring greater access to fuel for our vessels. This increases the flexibility of our activities,” says Erik Hånell.

Another important event during the year was the spin-off of the company’s digital platform, Orbit, which, with the help of smart data handling and AI increases effectiveness, leading to increased earnings and giving an advantage for the future. Orbit has been converted to a start-up company registered in New York City, where one of the new part-owners is a professor from Massachusetts Institute of Technology, the leading American technical university. ”Stena has an innovative culture, and via this new constellation we can safeguard the company’s innovative force. The idea in the longer term is for the system also to be sold to other operators in the industry,” says Erik Hånell.