Tanker Consolidation Spreads into Smaller Sizes

In the ocean shipping industry, there is a theory that consolidation moves from the largest size vessels to the smallest ones because of the capital required to reach commercial, technical and regulatory critical mass.

Starting in the late 1990s, we saw numerous transactions involving VLCCs with fleets such as N+T, Argonaut, Osprey and Golden Ocean changing hands in a relatively short period of time. In the intervening years came major ownership consolidation in the suezmax, aframax, panamax and even MR sizes when ambitious owners like Frontline, OMI, Teekay, Torm, OSG and others picked their market sectors of choice and began rolling up individual ships and entire companies.

The theory of trickle down appears to be holding true, and 2006 marks the year that ownership consolidation has officially moved into the realm of ships in the sub-25,000 dwt size category that carry chemicals and petroleum products.

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