Building of PSVs Slows Down

Completion of Platform Supply Vessels’ (PSVs) construction has taken a nosedive as affected owners delay the delivery of completed vessels triggered by challenging market conditions.

Driven predominantly by the downturn of crude oil prices that started in the summer of 2014 and heavy oversupply, ship owners were forced to cut costs and, aside to postponing deliveries, resorted to reductions in labor force as well.

As a result, the overall process of new buildings has been slowed down as the number of completed PSVs continues to shrink.

Based on the latest data by IHS Maritime & Trade, in Q3 of 2015, the number of completions sank to a new low of 29 ships, the lowest quarterly completion rate since 2013.

“This compares to approximately 39 and 42 completed newbuildings using averaged out yearly figures for all quarters during 2013 and 2014, respectively. Year to date, the average completion rate for all three quarters of 2015 thus far now stands at 32. Based on year-to-date production, China and the US now account for 38% and 25% of total PSV production, respectively,” IHS said.

IHS Maritime & Trade’s latest data now shows there are currently 1,939 PSVs in operation around the world.

Platform supply vessels specialize in logistics and service support and the transportation of goods, tools, equipment and personnel to and from offshore drilling platforms for oceanic oil and gas exploration. The figures above also include ships that carry supplies that include dry bulk, chemicals and other special goods.

Nevertheless, the first signs of recovery of oil prices seem to be emerging, according to the Chief Executive of Royal Dutch Shell Plc, Ben van Beurden.

“I see the first mixed signs for recovery of oil prices,” van Beurden is quoted by Reuters as saying at an oil industry conference in London.

“But with U.S. shale oil being more resilient than we originally thought and a lot of oil still in stock, it will take some more time to rebalance demand and supply,” he adds.

World Maritime News Staff