Trafigura to float Volare Shipping in Oslo as tanker rates surge

Traders Union
All News
Financial News
Trafigura lists Volare Shipping

Highlights

Trafigura plans to float Volare Shipping on the Oslo Stock Exchange in early October at a $500 million valuation, with IPO proceeds funding fleet expansion.
Tanker charter rates around the Gulf surged to a record $1 million a day last week amid rerouted supply chains following U.S.-Israeli strikes on Iran and Strait of Hormuz disruption.
Trafigura expects strong supertanker fundamentals for several years despite industry overcapacity concerns, as the order book reaches one-third of the active tanker fleet.

Oslo listing plan and fleet expansion

As reported by Financial Times, Trafigura says Volare Shipping will float on the Oslo Stock Exchange in early October, marking the commodities trader's first initial public offering of one of its businesses. The group values the supertanker arm at about $500 million and plans to use the proceeds to build up Volare's fleet for spot-market charters.

Volare is due to list with six supertankers in operation and another eight on order. The fleet will be managed by Trafigura, which already oversees about 500 vessels, including 250 tankers, as part of its trading operations.

Andrea Olivi, Trafigura's head of shipping, says the listing has been planned for some time, but market conditions for very large crude carriers have shifted sharply in recent weeks. He says Middle Eastern oil companies are buying ships to gain greater control over exports, a trend he expects to support earnings and asset values in coming months and quarters.

Market disruption lifts tanker earnings outlook

Tanker owners are benefiting from a sharp rerouting of energy supply chains after U.S.-Israeli strikes on Iran and the subsequent near-closure of the Strait of Hormuz. Longer voyage distances are tightening vessel availability, pushing charter rates and tanker values to fresh highs.

Last week, rates for voyages in and out of the Gulf reached a record $1 million a day, while shipbroker Clarksons says tankers operating around the strait remain far ahead of the wider market and that numerous vessels elsewhere are still being booked at about $800,000 a day. Prices for second-hand ships and newbuild tankers have also climbed as owners recover capital costs more quickly at current earnings levels.

Olivi says fundamentals for new supertankers should stay strong for several years as the global fleet ages and more vessels move into the shadow fleet carrying sanctioned Russian and Iranian oil. He also points to expected growth in crude exports from suppliers farther from Asian refineries, including Venezuela, Argentina and Guyana.

Even so, parts of the industry are warning about overcapacity because of the large number of ships on order, with the current order book equal to about one-third of the active fleet. Olivi says Trafigura's main concern is the early 2030s, when many of those vessels are expected to enter service, although some executives still argue the current market shift will support tanker demand for years.

Our earlier coverage of escalating U.S.-Iran tensions highlighted rising diplomatic and security risks ahead of UN meetings, alongside fresh warnings about potential retaliation across the region. We noted that despite the heightened conflict backdrop, oil prices eased on expectations that shipments could recover, while markets remained focused on the risk of disruption to key energy flows and strategic shipping lanes such as the Strait of Hormuz.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.