Morgan Stanley: Tanker Earnings Cycle May Extend Through 2028
Nashnova编辑部
Morgan Stanley sees the tanker earnings cycle lasting through 2028, with 2027 profits potentially exceeding 2026, and has raised earnings forecasts for China Merchants Energy Shipping and COSCO Shipping Energy.
Why does Morgan Stanley think tankers can keep earning through 2028?
The core argument is supply-demand structure: every month a key strait stays closed, annualized global seaborne crude volumes face roughly a 12% impact.
Demand absorbs a 10–15% hit, but only 5–6% of vessels are actually trapped. This means → the real capacity squeeze comes not from ships stuck in chokepoints, but from route uncertainty forcing redeployment.
In plain terms = the ships aren't physically blocked — they just don't know which route to take, and that indecision wastes effective capacity.
If there are more ships on paper, why haven't rates dropped?
Rates still find strong support around $100,000/day TCE — time-charter equivalent, the standard measure of what a shipowner earns per day.
The top three VLCC owners have roughly doubled their market share since early 2025, significantly strengthening their pricing power.
This means → higher concentration shifts the pricing leverage from cargo owners to shipowners, making it harder to push rates down.
Analysts estimate every $1 rise in freight costs could lift the two companies' 2027 earnings forecasts by 15–35%, depending on route mix.
What demand catalysts are still in play?
Prolonged strait closures have drawn down global crude inventories, creating future restocking demand. Every additional month of Asian consumption added to inventories could raise global tanker demand by roughly 6%.
In plain terms = depleted stockpiles eventually need refilling, and that restocking process itself sustains tanker demand — and it is a multi-year process, not a one- or two-quarter event.
Source switching adds further demand: if 5% of crude sourcing shifts from the Middle East to the U.S. Gulf, demand rises by nearly 6%. Add roughly 1% annual baseline consumption growth, and there are three layers of support.
Would a lifting of Iran sanctions crash the market?
Analysts argue that even if Iran oil sanctions are lifted, sanctioned vessels are unlikely to return quickly to the compliant fleet — some may be scrapped.
This means → the capacity released by sanctions relief would be smaller than the market assumes, making it less of a bearish shock.
Morgan Stanley frames this scenario as an upside case that could extend the tanker upcycle further into 2028.
This reflects a key judgment call: whether the cycle delivers depends on the actual pace of global crude inventory rebuilding and the evolution of strait access conditions.
Content is for reference only, not financial advice.