Broker says ‘hundreds’ of OSVs stuck in the Persian Gulf

In its latest Offshore Report, Fearnley Offshore Supply said the crisis also risks seeing final investment decisions for oil and gas projects postponed.

Fearnley Offshore Supply said the US and Israeli attacks on Iran have “thoroughly shaken things up” in the oil and gas market and in the OSV sector.

“It is difficult to accurately predict the effects and consequences of the war,” said the broker, “but in the short term, there is a lot of offshore activity that has been put on hold.”

Another potential issue arising from the war is the risk that final investment decisions (FIDs) for new projects could be deferred, potentially for years. “There were several projects in the pipeline that are now at risk pending the conflict,” said Fearnley Offshore Supply. 

“Ongoing project developments are also at risk, such as QatarEnergy’s North Field Expansion, ADNOC’s Hail and Ghasha sour gas project, and Saudi Aramco’s Marjan and Zuluf brownfield upgrades.

“The closure of the Strait of Hormuz means very little oil and gas is leaving the region, but storage options are also quickly running out. As a consequence of the latter, regardless of the conflict, several fields have shut down production.”

The broker noted that Saudi Aramco is shutting down the Safaniya and Zuluf fields, taking 2M barrels per day out of production, joining other companies that have taken similar measures.

“All in all, this spells bad news for the hundreds of OSVs now stuck in the Persian Gulf,” the broker said. “Production support has previously been, and elsewhere still is, a key driver for vessel work, especially for anchor-handling tug/supply vessels and platform supply vessels that account for the vast majority of work for these assets.”