Author Topic: Anyone else investing in oil tankers right now?  (Read 1839 times)

J Boogie

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Anyone else investing in oil tankers right now?
« on: May 07, 2020, 10:43:40 AM »
I recently stumbled upon oil tankers as irrationally undervalued right now.

Covid, the difficulty of stopping oil production temporarily, the geopolitical incentives for Russia and Saudi Arabia to NOT make the recommended production cuts, the limited onshore storage capacity, and the fines for dumping it all point to a lucrative 4-18 months ahead for floating storage.

Floating storage is kind of a perfect temporary flex solution to this problem and I don't envision another way this can play out.

Perhaps tanker stocks got pumped up, attracting the short term buyers when the NAT CEO went on Cramer and spoke hyperbolically about the state of the tanker market. The dump came soon after and while company after company posted very strong, sometimes historically high earnings the market hasn't responded all that much. Even the analyst who downgraded the stocks couldn't believe the sell off after strong earnings.

https://www.freightwaves.com/news/inside-the-mind-blowing-crazy-insane-ridiculous-tanker-sell-off

I am long DHT, FRO, STNG, EURN, TNP, TNK

Yesterday was a big buying day and today isn't bad - plenty of room for these to run if you believe in the high demand for floating storage thesis.



L.A.S.

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Re: Anyone else investing in oil tankers right now?
« Reply #1 on: May 07, 2020, 10:58:06 AM »
Oil is very volatile.

My guess is that the oversupply will be short lived and we will quickly swing to shortages. Projects are being mothballed.. Legacy low producing wells are being shut in and will never reopen. Creditors have been totally and royally burned by the whole sector, so I doubt there will be access to borrowed money to acquire more capital stock, plant, and equipment, and finance new projects. Also, I have to believe that the covid crisis is affecting oil sector workers as well, so the man power needed to get the oil out of the ground is limited. As the economy reopens I would suspect that OPEC+ would want to still limit supply and take advantage of high prices in order to remedy some of the damage done by the boneheaded price war.

bwall

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Re: Anyone else investing in oil tankers right now?
« Reply #2 on: May 07, 2020, 11:07:37 AM »
Tankers are much riskier than they appear. I'm not quite sure why that is.

How many new buildings are there for 2020? How many ship-breakings? What are the building and breaking projections for 2021?

Tanker companies tend to focus on dividends and not stock price appreciation, for whatever reason. They also tend to be poorly run.

I think the last time there was great/amazing day rates for tankers was when oil hit $147 in 2008. Tankers were lined up off the coast of California and told not to deliver their cargo as the price was going up so much each day that it made sense to wait. Then when the price fell, it dropped to $25 in short order--all the tankers were off-loading their cargo. During that time the tankers could charge eye-watering rates and it was still cheaper to wait as the spot price was soaring.

With the price of oil so low, I view tankers-as-storage as a short term solution to an oversupply problem that will correct itself, not a medium-term bull market in tankers.

J Boogie

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Re: Anyone else investing in oil tankers right now?
« Reply #3 on: May 07, 2020, 11:17:47 AM »
Creditors have been totally and royally burned by the whole sector, so I doubt there will be access to borrowed money to acquire more capital stock, plant, and equipment, and finance new projects.

I think that's actually a plus, not a minus for tanker stocks.

Part of the reason they can enjoy higher rates today is because they haven't been able to build tons of new ships.

For the most part, the companies I'm investing in are certainly not planning on growing their fleet but rather paying down debt, buying shares back, or paying special dividends with the windfalls they're getting.

J Boogie

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Re: Anyone else investing in oil tankers right now?
« Reply #4 on: May 07, 2020, 11:19:54 AM »
Tanker companies tend to focus on dividends and not stock price appreciation, for whatever reason. They also tend to be poorly run.

I think it's because they all know growth (fleet expansion) is actually bad for their pricing power.

Some have mentioned they'll be buying back shares if the market fails to appreciate their success.

J Boogie

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Re: Anyone else investing in oil tankers right now?
« Reply #5 on: May 07, 2020, 01:17:15 PM »
I think the last time there was great/amazing day rates for tankers was when oil hit $147 in 2008. Tankers were lined up off the coast of California and told not to deliver their cargo as the price was going up so much each day that it made sense to wait. Then when the price fell, it dropped to $25 in short order--all the tankers were off-loading their cargo. During that time the tankers could charge eye-watering rates and it was still cheaper to wait as the spot price was soaring.

With the price of oil so low, I view tankers-as-storage as a short term solution to an oversupply problem that will correct itself, not a medium-term bull market in tankers.

Well, based on your logic, price volatility can benefit tankers whether prices are rising or falling.

Why wouldn't those who have chartered floating storage extend their contracts if they believed that prices were still rising? Lack of decent cash flow, perhaps.

Why do you believe the oversupply problem will correct itself? To me it seems far more likely that the oversupply "problem" will require global cooperation and mutual trust between countries that have shown they don't have very much of that to extend to one another. I say "problem" because I don't think the Saudis/Russians view it as a problem at all, rather they might view it as an opportunity to kneecap smaller competitors. And the Russians are likely to cheat. Members of congress making a stink to the Saudis won't accomplish much as its mostly the obstinate Russian with the appetite for the pissing match, even if they don't have the wherewithal of the Saudis.



bwall

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Re: Anyone else investing in oil tankers right now?
« Reply #6 on: May 07, 2020, 02:36:25 PM »
I think the last time there was great/amazing day rates for tankers was when oil hit $147 in 2008. Tankers were lined up off the coast of California and told not to deliver their cargo as the price was going up so much each day that it made sense to wait. Then when the price fell, it dropped to $25 in short order--all the tankers were off-loading their cargo. During that time the tankers could charge eye-watering rates and it was still cheaper to wait as the spot price was soaring.

With the price of oil so low, I view tankers-as-storage as a short term solution to an oversupply problem that will correct itself, not a medium-term bull market in tankers.

Well, based on your logic, price volatility can benefit tankers whether prices are rising or falling.

Why wouldn't those who have chartered floating storage extend their contracts if they believed that prices were still rising? Lack of decent cash flow, perhaps.

Why do you believe the oversupply problem will correct itself? To me it seems far more likely that the oversupply "problem" will require global cooperation and mutual trust between countries that have shown they don't have very much of that to extend to one another. I say "problem" because I don't think the Saudis/Russians view it as a problem at all, rather they might view it as an opportunity to kneecap smaller competitors. And the Russians are likely to cheat. Members of congress making a stink to the Saudis won't accomplish much as its mostly the obstinate Russian with the appetite for the pissing match, even if they don't have the wherewithal of the Saudis.

Volatility can benefit tankers, yes.

How much of a tankers' business is floating storage versus actual transportation? I think that up to, say, a month ago it was very little. I think that now little has changed, though the tanker-as-storage demand would certainly be there. It's hard to say, but just a best guess. I have no inside information.

Oversupply in the oil market vs oversupply in the tanker market. Two different markets, although my comment was in reference to the oversupply in the oil market.
The USA is now the swing producer in the global oil market. As prices fall, these privately owned companies will exit production naturally. Demand destruction as a result of the pandemic is enormous and this is the greater problem. As you (correctly) observe, there is little goodwill shared among the large oil producers. Oversupply will remain a problem, but price signals from the market will lead to supply and demand returning to some sort of equilibrium.

How many new buildings are there for 2020? How many ship-breakings? What are the building and breaking projections for 2021?

Here is the biggest problem for the tanker market. I didn't see this point being addressed, so I'm not sure if you've researched this.

In 2018: 34 VLCC's delivered and 38 scrapped ---> tanker supply and demand remain in balance
In 2019: over 60 (!!) VLCC's delivered and 7 scrapped (!!!) ---> huge increase in tanker supply!!!
In 2020: projected 40 deliveries.
In 2021: projected 19 deliveries.

Read more here:
https://www.argusmedia.com/en/news/2035228-viewpoint-mideast-vlcc-rates-to-remain-under-pressure

In my opinion, I don't see the tanker-as-storage market being able to compensate for these headwinds, b/c, well, the tanker market can turn on a dime. YMMV.
Read more here:

https://www.spglobal.com/platts/en/market-insights/latest-news/oil/043020-tankers-americas-vlcc-freight-plummets-28-as-spot-inquiry-sees-lull

J Boogie

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Re: Anyone else investing in oil tankers right now?
« Reply #7 on: May 07, 2020, 03:44:35 PM »

Here is the biggest problem for the tanker market. I didn't see this point being addressed, so I'm not sure if you've researched this.

In 2018: 34 VLCC's delivered and 38 scrapped ---> tanker supply and demand remain in balance
In 2019: over 60 (!!) VLCC's delivered and 7 scrapped (!!!) ---> huge increase in tanker supply!!!
In 2020: projected 40 deliveries.
In 2021: projected 19 deliveries.

Read more here:
https://www.argusmedia.com/en/news/2035228-viewpoint-mideast-vlcc-rates-to-remain-under-pressure

In my opinion, I don't see the tanker-as-storage market being able to compensate for these headwinds, b/c, well, the tanker market can turn on a dime. YMMV.
Read more here:

https://www.spglobal.com/platts/en/market-insights/latest-news/oil/043020-tankers-americas-vlcc-freight-plummets-28-as-spot-inquiry-sees-lull

You're right, that could be the fly in the ointment. I didn't have any of those stats on hand, though I follow some industry folks who share related info. Thanks for sharing those articles.

https://twitter.com/calvinfroedge/status/1258425554442780672/photo/2

From what I'm seeing here there isn't too much likelihood of tanker overpopulation given fleet age and I think IMO 2020 suphur cap supports the notion that older ships will be decommissioned sooner rather than later.

Seems you have a lot of knowledge here - have you invested or worked in this area before?

bthewalls

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Re: Anyone else investing in oil tankers right now?
« Reply #8 on: May 07, 2020, 04:55:58 PM »
Iím investing small in some larger oil...up 25 percent in 2 weeks which is ok

MustacheAndaHalf

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Re: Anyone else investing in oil tankers right now?
« Reply #9 on: May 08, 2020, 04:08:11 AM »
Investing in Oil transportation companies profits as economies reopen.  If you estimate a second wave of COVID-19 to be less severe or less likely than the market (my view), then oil transportation makes sense.

I've taken "when the data changes I change my view" to a bit of an extreme, often flipping my pessimism/optimism each week.  So keep that in mind when I say that my current data suggests a partial reopening is likely to be more successful than expected.

I watched Denmark's case numbers after they reopened schools.  Schools!  Kids are excellent at spreading disease, so I checked on Denmark 4-5 days later, expecting new infections to spike... same 150 new cases/day... week later... same.  Denmark saw no change whatsoever in the data I have.  Their northerly neighbor Sweden didn't do a full shut down, but opted for shelter according to risk factor, and personal responsibility for social distancing.  They have not retracted that view, and remain mostly open.  It looks like reopening, with restrictions on the most risky events, can work.

Which means people may ramp up their normal activities like driving places, and that will cause oil demand go to back up.  So if reopening goes well, oil demand will go up with it.

As an aside, there was some interesting peak oil storage circumstances in April.  The U.S. allowed it's strategic oil reserve to hold oil, oil tankers were rented for storage, and OPEC+ agreed to production cuts.  There may have been a possibility of peak oil storage in May, but that date has been pushed out indefinitely, from what I can tell.

bwall

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Re: Anyone else investing in oil tankers right now?
« Reply #10 on: May 08, 2020, 09:52:43 AM »
From what I'm seeing here there isn't too much likelihood of tanker overpopulation given fleet age and I think IMO 2020 suphur cap supports the notion that older ships will be decommissioned sooner rather than later.

Seems you have a lot of knowledge here - have you invested or worked in this area before?

I'm just an avid stock picker, I guess. Once upon a time I was seduced by the fat tanker dividends and had my heart broken. The value of the stock is in it's power to give dividends. Full stop. Do not expect much appreciation in the stock as there will be numerous dilutions in the bad times. I doubt there'll be buybacks. You can be lucky if they pay down their debt in good times. These are not well run companies and management has, well, issues, as their values don't necessarily match yours.

Financial.Velociraptor

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Re: Anyone else investing in oil tankers right now?
« Reply #11 on: May 08, 2020, 12:37:40 PM »
Oil is very volatile.

My guess is that the oversupply will be short lived and we will quickly swing to shortages. Projects are being mothballed.. Legacy low producing wells are being shut in and will never reopen. Creditors have been totally and royally burned by the whole sector, so I doubt there will be access to borrowed money to acquire more capital stock, plant, and equipment, and finance new projects. Also, I have to believe that the covid crisis is affecting oil sector workers as well, so the man power needed to get the oil out of the ground is limited. As the economy reopens I would suspect that OPEC+ would want to still limit supply and take advantage of high prices in order to remedy some of the damage done by the boneheaded price war.

I think you have some (common) misconceptions about the oil industry.  Legacy wells with low production get shut in LAST.  There is a non zero cost to shut in a well. If the cost of doing so is more than the cost of what you are losing on small number of barrels, you just keep pumping.  New wells make sense to shut in.  They can be reopened when prices recover, thus making the shut-in/restart costs the cost of using the well itself as temporary storage. 

The banks will still loan money operators.  They sort of have to.  Banking in the US is by state.  Thus, if a state has most of its lending opportunities in shale, the banks have few other options.  The banks that specialize in oil lending (such as Frost) have former oil executives on retainer.  They are prepared to take possession of their collateral and operate it as a business until they can get a fair market price.  This cycle has played out plenty of times and the banks always come back to the oil patch.

Manpower could be a problem when restarts are needed but roughnecks tend to be crazy people who will work sick.  Restarting a shut in well happens rapidly and there are thousands of DUC's (Drilled Uncompleted) wells out there that just need to be fracked to produce.  You could say the E&P companies have their ducks in a row (see what I did there?)  Shale can ramp up production very fast if prices recover.  The lack of pipeline capacity is the real limiting factor.

I think you have it right that OPEC plans to cause the price to run up rather than restore pumping when prices recover.

markbike528CBX

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Re: Anyone else investing in oil tankers right now?
« Reply #12 on: May 08, 2020, 12:47:41 PM »
TK bought @46 on 1/2006, now 3.38 92% loss.  I used to get some dividends......



bwall

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Re: Anyone else investing in oil tankers right now?
« Reply #13 on: May 08, 2020, 01:11:19 PM »
TK bought @46 on 1/2006, now 3.38 92% loss.  I used to get some dividends......

Ouch! That hurts. Tanker stocks are different.

markbike528CBX

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Re: Anyone else investing in oil tankers right now?
« Reply #14 on: May 08, 2020, 07:10:43 PM »
TK bought @46 on 1/2006, now 3.38 92% loss.  I used to get some dividends......

Ouch! That hurts. Tanker stocks are different.

It is or was a oil tanker stock.  They've spun off a LNG tanker division, by the core is still oil tanker.

J Boogie

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Re: Anyone else investing in oil tankers right now?
« Reply #15 on: May 09, 2020, 05:50:37 AM »
TK bought @46 on 1/2006, now 3.38 92% loss.  I used to get some dividends......

Ouch! That hurts. Tanker stocks are different.

It is or was a oil tanker stock.  They've spun off a LNG tanker division, by the core is still oil tanker.

I think he knows that TK is a tanker stock and means that tanker stocks are "different" than a given random S&P stock which probably would have appreciated a lot since 2006.


J Boogie

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Re: Anyone else investing in oil tankers right now?
« Reply #16 on: May 09, 2020, 06:00:34 AM »
From what I'm seeing here there isn't too much likelihood of tanker overpopulation given fleet age and I think IMO 2020 suphur cap supports the notion that older ships will be decommissioned sooner rather than later.

Seems you have a lot of knowledge here - have you invested or worked in this area before?

I'm just an avid stock picker, I guess. Once upon a time I was seduced by the fat tanker dividends and had my heart broken. The value of the stock is in it's power to give dividends. Full stop. Do not expect much appreciation in the stock as there will be numerous dilutions in the bad times. I doubt there'll be buybacks. You can be lucky if they pay down their debt in good times. These are not well run companies and management has, well, issues, as their values don't necessarily match yours.

I suspect lousy management and performance has left such a bad taste in investors' mouths that they don't want to touch these stocks again, even when the environment is quite favorable.

I think that's why they're so undervalued right now.

Except NAT, which had tons of Robinhood (read: young and inexperienced) investors pile in after the CEO went on Cramer for the previously mentioned pump and dump.

I appreciate you sharing your experience and knowledge here.

ice_beard

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Re: Anyone else investing in oil tankers right now?
« Reply #17 on: May 11, 2020, 10:42:45 AM »
I've been following tanker stocks the past few weeks.  I've got some FRO and some other midstream companies that are involved in storage. 
I'm under the impression that tanker companies have a negative history with investors because of poor management, almost across the board.  I'm under the impression this has evolved in a positive manner over recent years, but there are still some shady players (NAT).

I find the crashing of tanker stocks over the past few weeks a bit mind boggling while these companies are smashing earnings expectations and in some cases, have second quarter bookings at incredibly high rates.  For example, DHT reported that it had 66% of its available VLCC spot days booked for the second quarter at an average rate of $110,400 per day.  https://www.freightwaves.com/news/investors-dump-tanker-stocks-just-as-tanker-profits-soar   A more "normal" rate for a VLCC is around $30,000/day.  Anything 6 figures is very good. 

It sounds like when Saudi Arabia dumped a ton of oil on the market in March, VLCC rates were even higher (up to $300,000) which probably represents a lot of the profits from q1.  https://www.rigzone.com/news/saudi_belligerence_pushes_vlcc_rates_to_comedic_highs-01-apr-2020-161585-article/

In any matter, this is a market that is marked by rapid swings up and down and can be known for large but sporadic dividends.  I'll probably pick up a bit of DHT with its somewhat depressed price before the ex div date of May 18.  Div is .35 on a stock trading at $6.50 right now.  I wonder if yield chasers will see this and increase the price of the stock up to the 18th and then dump?  Q2 dividend should also be tasty.  After that, who knows?? 

Edited:  I don't think I want any more tanker exposure.  I think I'll just hold tight for now and see what happens. 

I saw bwalls experience.... ouch.  Has anyone else held these long term and want to chime in??
 

« Last Edit: May 11, 2020, 12:37:11 PM by ice_beard »

J Boogie

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Re: Anyone else investing in oil tankers right now?
« Reply #18 on: May 11, 2020, 12:58:14 PM »
I think the other factor keeping investors away is the uncertainty surrounding a rapid and successful re-open and what kind of environment it would create for tankers.

My simple logic (and it might be TOO simple, please poke holes) is that this wouldn't be much of a problem for tankers. They can transition from storage mode to transportation mode again, and at that point there are other positive catalysts working in their favor - the aging fleet, the new IMO regulations. The IMO regulations will hasten the decommissioning of the older ships not worth installing scrubbers on and there will be a decent period of fewer tankers available for chartering before new ships get built and introduced into global tanker counts. There will probably also be increased demand for crude transportation as crude will need to be transported to specific low sulfur refineries rather than whatever refinery is closest.



bwall

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Re: Anyone else investing in oil tankers right now?
« Reply #19 on: May 11, 2020, 01:51:49 PM »
I don't think that tanker stocks are undervalued right now. I think that they are properly valued by the market. They are poorly run, management is not interested in shareholder value and the market recognizes this as such. Market actors acquire this wisdom at their own pace.

And I do include TK in this cohort of tanker stocks that perform dismally.

Tanker rates are dependent on supply of and demand for tankers, not oil. Tanker rates can swing violently as the bidding process is opaque--each actor is trying to maximize their utility and not over-bid or under-offer. (In economics terms it's called 'consumer surplus' or 'producer surplus')  Lots of time it's a question of which party is more desperate--the bidder or the offerer.

Contract amounts are announced, but there is always a doubt as to the veracity of those amounts; '66% of available spot days booked at $110k per day' can mean anything. Literally. Anything. For example, the company might have 20 ships, but only three of them available for booking at the spot rate since the others are on long term charter. They book out two of them for $110k and the third sits unchartered. If my hypothetical holds true, what does the quoted rate tell us about the health of the company? Nothing. BUT IT'S A GREAT HEADLINE, ISN'T IT!?!?!?!!?  And, it serves a great benchmark for others to quote in negotiations.

ice_beard

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Re: Anyone else investing in oil tankers right now?
« Reply #20 on: June 02, 2020, 10:11:08 AM »
Down day today for tankers.  VLCC rates fluctuate but are still looking favorable from at least what is publicly available. DHT went below $5.80.  I bought some. 

If nothing else, it's been very interesting learning about the international shipping trade the past few months.  Watching NAT become an absolute RH meme stock has also been entertaining.  Am I buying into the same hype?  Probably.  Doesn't really change that these companies are making money hand over fist this year.  In this industry, it appears that doesn't mean stock prices will increase. 
I read that hedge funds have been burnt so many times by tankers that it's a sector they simply stay the hell away from.  Without the big players, it's difficult to get a whole lot of price movement. 

J Boogie

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Re: Anyone else investing in oil tankers right now?
« Reply #21 on: June 02, 2020, 03:06:57 PM »
Down day today for tankers.  VLCC rates fluctuate but are still looking favorable from at least what is publicly available. DHT went below $5.80.  I bought some. 

If nothing else, it's been very interesting learning about the international shipping trade the past few months.  Watching NAT become an absolute RH meme stock has also been entertaining.  Am I buying into the same hype?  Probably.  Doesn't really change that these companies are making money hand over fist this year.  In this industry, it appears that doesn't mean stock prices will increase. 
I read that hedge funds have been burnt so many times by tankers that it's a sector they simply stay the hell away from.  Without the big players, it's difficult to get a whole lot of price movement.

I bought more today as well.

Due to the lack of investor support for this sector, I'm heavier into DHT and FRO than my other holdings that won't be paying as large of a dividend.

I figure it's a decent way to make sure I get paid even if investors never warm up to the thesis.

They're making good money and some of them are doing a good job of mitigating mid term risk by getting into 12 month (and longer) fixtures at decent rates.






ice_beard

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Re: Anyone else investing in oil tankers right now?
« Reply #22 on: June 22, 2020, 09:37:01 AM »
I sold my tanker stocks a few weeks ago on one of those rally Fridays.  With a couple dividends, I made a small profit.  Glad I got out when I did.  This sector really doesn't make a whole lot of sense.  I realize the entire market right now doesn't make a lot of sense, but tanker cos (esp. VLCC heavy ones, like DHT) are raking in cash yet their stock prices continue to crater. 

Apparently Fidelity bought a 10% stake in DHT a few weeks ago.  This would make most people think there must be some viability here as an investment, yet the price continues to fall.  Almost at $5.  I still watch DHT and I'm reminding myself how irrational tanker stocks act, so don't be lured in by the dropping stock price and those juicy dividends.

J Boogie

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Re: Anyone else investing in oil tankers right now?
« Reply #23 on: June 23, 2020, 02:35:46 PM »
I sold my tanker stocks a few weeks ago on one of those rally Fridays.  With a couple dividends, I made a small profit.  Glad I got out when I did.  This sector really doesn't make a whole lot of sense.  I realize the entire market right now doesn't make a lot of sense, but tanker cos (esp. VLCC heavy ones, like DHT) are raking in cash yet their stock prices continue to crater. 

Apparently Fidelity bought a 10% stake in DHT a few weeks ago.  This would make most people think there must be some viability here as an investment, yet the price continues to fall.  Almost at $5.  I still watch DHT and I'm reminding myself how irrational tanker stocks act, so don't be lured in by the dropping stock price and those juicy dividends.

I sold off about half my tanker holdings then as well.

I've been buying back in during these massive dips.

Still very long tankers. We'll see how things shake out.

ice_beard

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Re: Anyone else investing in oil tankers right now?
« Reply #24 on: June 25, 2020, 03:12:57 PM »
(Head down shamefully...)  I bought back into DHT with a small position today at $5.13.  Will be watching EURN closely too. 

Have you seen this video about the current oil tanker industry? 
https://www.youtube.com/watch?v=uz80uvpObCY 

It's very good.  It's basically a discsussion between a shipping expert (J. Mintzmyer) and an investor.  The shipping expert goes on to explain contract specifics (around 21:00) using the VLCC Fixtures app.  There is also some good discussion of the recent and upcoming market in general.  Definitely worth your time if you are seriously interested in this market. 

J Boogie

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Re: Anyone else investing in oil tankers right now?
« Reply #25 on: June 29, 2020, 10:45:30 AM »
(Head down shamefully...)  I bought back into DHT with a small position today at $5.13.  Will be watching EURN closely too. 

Have you seen this video about the current oil tanker industry? 
https://www.youtube.com/watch?v=uz80uvpObCY 

It's very good.  It's basically a discsussion between a shipping expert (J. Mintzmyer) and an investor.  The shipping expert goes on to explain contract specifics (around 21:00) using the VLCC Fixtures app.  There is also some good discussion of the recent and upcoming market in general.  Definitely worth your time if you are seriously interested in this market.

Oh yes. I follow Mariusz, Calvin, and J Mintz. They're characters. Tanker bulls are a weird bunch.