From BigGo Finance · BigGo Finance · · 1m 20s
US Weighs Releasing Sanctioned Tankers to Tame Freight Rates
US plans to lift sanctions on 24 sanctioned tankers to lower freight rates before midterms, but aging ships limit impact.
In brief
US plans to lift sanctions on 24 sanctioned tankers to lower freight rates before midterms, but aging ships limit impact. US considers easing sanctions on 24 of 160 sanctioned tankers to reduce freight rates ahead of midterms, but aging vessels limit supply expansion. Originally reported by BigGo Finance.
US considers lifting sanctions
The Trump administration is considering lifting sanctions on some tankers blacklisted over ties to Russia, Iran and Venezuela to bring them back into the commercial shipping market.
High freight rates drive plan
With VLCC rates topping $1.4 million a day amid the U.S.-Iran war, the plan aims to calm energy prices ahead of next month's midterm elections.
Kpler estimates limited return
Kpler estimates only 24 of the 160 sanctioned VLCCs could realistically return to service if sanctions are lifted.
Aging vessels limit supply
The sanctioned tankers have an average age of 22 years, with 27% older than 20 years and only about 20 holding valid class certificates.
Shadow fleet operates unofficially
Global shipbroker BRS analyzed that many sanctioned vessels are already operating unofficially, so lifting sanctions may not increase supply.
Political motive for action
The move aims to increase tanker supply to drive down freight rates and stabilize energy prices ahead of midterms.
The essence
US considers easing sanctions on 24 of 160 sanctioned tankers to reduce freight rates ahead of midterms, but aging vessels limit supply expansion.
