2025 in the OSV sector: tight capacity, strong demand underpins positive outlook

While momentum behind newbuild orders continues to gain speed, new capacity entering the offshore support vessel (OSV) sector in 2025 will be limited, keeping availability tight. This should continue to strengthen day rates and active fleet utilisation.

By mid-December 2024, firm orders for OSV newbuilds had eclipsed 30 vessels over the last 12 months, with spending levels totalling more than US$1.1Bn, as tracked by OSJ.

The new year should see additional newbuild orders placed as owners and investors flock to take advantage of rising day rates and a broad spectrum of projects over the next few years in offshore energy covering oil and gas, renewables, decommissioning and carbon capture. But their efforts to place new orders will be blunted by tight shipyard capacity and a reluctance by traditional banking institutions to finance new assets for the offshore oil and gas sectors because of ESG concerns. Owners and investors that don’t hold options on current shipbuilding contracts might well be shut out of preferred Chinese shipyards as slots dwindle.

Active OSV utilisation is expected to be in the range of 75% to 78% in 2025, according to an analysis by Westwood Global Energy.

Brazilian shipyards will benefit from Petrobras renewing the country’s OSV fleet. The Brazilian oil major rolled out plans for US$77Bn in E&P spending from 2025-2029 and has begun issuing build-charter contracts for OSV newbuilds. One of the latest will see 12 diesel-electric-battery hybrid platform supply vessels constructed at domestic shipyards owned by BRAM Offshore and Starnav under contracts totalling US$2.7Bn. Each contract includes four years of mobilisation and 12 years of operation — making financing viable. A good chunk of money will also be spent on modernising and upgrading Brazilian shipyards, too.

Besides Brazil, South America’s oil boom is being led by deepwater development in Suriname and Guyana, the latter of which will see a consortium of ExxonMobil, Hess and CNOOC spend US$55Bn to develop six government-backed projects in the offshore Stabroek block. Oil output for the country is expected to reach 1.2M barrels of oil per day (b/d) by 2027, while Brazil’s will hit 5.4M b/d by 2029. Southeast Asia, the Middle East and West Africa hold promise, too.

In the US, President Trump has promised to unleash American oil and gas when he takes office on 20 January, and his pick for Secretary of Energy, Chris Wright, chief executive for Liberty Energy, appears to favour an ‘all-of-the-above’ energy strategy. This should bode well for investment in the US Gulf of Mexico. Additionally, while President Trump has vowed to ‘kill’ offshore wind when he takes office, states will continue to roll out their own plans for renewables to meet their growing energy needs and sustainability goals.

Meanwhile, it will be interesting to see how OPEC+ reacts to the increase in oil and gas production that will come out of both North and South America. On 5 December, OPEC+ announced production cuts that would decrease global oil inventories by about 700,000 b/d in Q1 2025.

But after Q1 2025, additional OPEC+ production and continued supply growth outside of the cartel should reverse this trend of decreasing inventory, says the US Energy Information Administration, which expects inventory to grow by about 100,000 b/d over the remainder of 2025. As a result, US EIA predicts “some downward pressure on crude oil prices” in H2 2025, with Brent crude oil spot price to fall from an average US$74 per barrel in Q1 2025 to an average US$72 per barrel Q4 2025.