Red Sea reopening could benefit Suezmax tankers, says Greek owner

Speaking on an earnings investor call after disclosing its Q4 results, the US- and Oslo-listed shipowner’s management team noted a return to normal operations in the Red Sea could restore trade routes that had been phased out due to the higher costs of rerouteing cargoes around the Cape of Good Hope.

Okeanis Eco Tankers highlighted some westbound cargoes, which had been absorbed by VLCCs travelling via the Cape of Good Hope, could return to Suezmax tonnage. Additionally, Mediterranean and Black Sea barrels, which had completely halted their eastbound trade, may resume operations.

"So, I would say it is positive for the Suezmaxes for the Red Sea to reopen," said Okeanis Eco Tankers chief executive Aristidis Alafouzos.

On the other hand, the company does not foresee a major impact on VLCCs. Management noted some companies with equity barrels – which discharge in the Red Sea after loading in the Middle East Gulf – typically use their own ships for these trades. If the Red Sea passage reopens, it might generate slightly more business for the normal fleet, but the company does not believe it will have the same impact as for Suezmaxes.

Two-tier market following sanctions

Discussing developments in the so-called dark fleet, Okeanis Eco Tankers noted in its earnings presentation that the growing divide between compliant and non-compliant markets will favour modern tonnage as sanctions expand.

"As sanctioned exports decline, compliant producers with spare capacity may step in, increasing demand for modern, efficient tonnage and strengthening the position of compliant fleets," the company stated.

During the investor call, the management team emphasised tanker utilisation drops significantly once a vessel enters the ’grey fleet’, even more so if it is sanctioned by the EU or UK, and drastically if it is targeted by the US.

Financial performance

Okeanis Eco Tankers reported total revenue of US$392M in 2024, down from US$413M in 2023, while net profit declined to US$109M from US$145M the previous year.

The company posted a fleetwide daily TCE of US$52,898 in 2024, compared with US$59,281 in 2023, partially explaining the decline in financial results.

For Q1 2025, Okeanis Eco Tankers has already fixed 81% of its available VLCC spot days at US$39,100 per day and 77% of its available Suezmax spot days at US$33,400 per day.

Okeanis Eco Tankers operates a fleet of 14 tankers, consisting of eight VLCCs and six Suezmaxes.