BIMCO expects crude tanker markets to remain strong through 2026 and 2027, despite signs of softening in 2027, while product tanker earnings are forecast to weaken amid accelerating fleet growth.
“We expect continued strong market conditions for crude tankers in 2026 and 2027 despite some weakening in 2027. On the other hand, we forecast that the product tanker market will weaken during both years as fleet and supply growth accelerates,” said Niels Rasmussen, Chief Shipping Analyst at BIMCO.
Oil Supply to Outpace Demand
According to the International Energy Agency (IEA), global oil demand is projected to grow by 0.9 million barrels per day (mbpd) in 2026, while supply is expected to expand by 2.4 mbpd. As a result, oil market oversupply is forecast to widen and peak at 4.1 mbpd in the second quarter of 2026.
Meanwhile, the U.S. Energy Information Administration (EIA) anticipates stronger demand growth of 1.2–1.3 mbpd annually in 2026–2027, alongside weaker supply growth of 1.6 mbpd in 2026 and 0.9 mbpd in 2027. Under this scenario, oversupply is expected to peak at 3.2 mbpd in the first quarter of 2026.
The EIA also forecasts Brent crude prices to decline from an average of USD 69 per barrel in 2025 to USD 58 in 2026 and USD 53 in 2027. Lower prices are likely to encourage inventory builds during 2026, although current US–Iran tensions have temporarily pushed Brent above USD 70 per barrel.
Inventory Builds to Support Crude Tankers
Inventory expansion is expected to underpin crude tanker demand through 2026, potentially providing spillover opportunities for product tankers to trade in the dirty segment. However, BIMCO warns that inventory builds could taper off in 2027, with the possibility of stock drawdowns emerging thereafter.
Geopolitical risks remain a critical factor. Although the Strait of Hormuz has never been fully closed, any escalation in US–Iran tensions could disrupt flows. Approximately 30% of global seaborne oil exports transit the strait, making it a key chokepoint for tanker markets.
In addition, mounting pressure on sanctioned and parallel fleets may benefit mainstream operators. Venezuelan oil exports have already shifted towards mainstream tankers, and any reduction in Russian or Iranian exports could further support conventional fleet demand.
Order Book Growth Raises Supply Concerns
Since BIMCO’s previous report, the crude tanker order book has expanded by 24%, while the product tanker order book has increased by 5%. The order book-to-fleet ratios now stand at 18% for crude tankers and 19% for product tankers.
Unless vessel recycling accelerates beyond current forecasts, BIMCO cautions that rising fleet capacity could drive market weakening in the coming years.
“To mitigate the projected weakening in market conditions, recycling activity in the coming years will need to rival historic highs,” Rasmussen noted.
Vessels aged 20 years or more account for 18–22% of total capacity across crude and product tanker fleets, representing a substantial pool of potential recycling candidates. However, scrapping may be constrained by restrictions on sanctioned vessels, which represent 29% of older crude tanker capacity and 59% of older product tanker capacity.
Outlook
While crude tanker markets appear poised to remain resilient in the near term—supported by inventory builds, geopolitical uncertainties, and potential shifts from sanctioned fleets—product tankers face mounting headwinds from accelerating supply growth. The balance between recycling activity and new deliveries will ultimately determine the sector’s earnings trajectory through 2027.
