Seatrade-Maritime: VLCC newbuild order surge set to stall as yards max out

Published by Seatrade-Maritime

Tanker owners have placed a record volume of VLCC newbuilding orders this year as charter rates have shot up to unprecedented levels, but analyst Veson Nautical believes contracting will come to halt due to a lack of yard capacity and equipment availability.

The VLCC orderbook has seen phenomenal growth this year up 358% year-to-date compared to 2025 according to Veson Nautical. In September 2025 the ratio of newbuildings to existing fleet stood at 15% but one year later in September 2026 it stands at 38% of the current fleet on the water.

Matthew Freeman, VP Valuation & Analytics for Veson Nautical, notes that a year ago when the VLCC orderbook stood at 15% of the existing fleet and Suezmax orderbook 22% of the existing fleet and at the same time around 18% of the large tanker fleet was sanctioned. With net orderbook that roughly equalled the amount of sanctioned ships it provided owners with an opportunity to upgrade their fleet resulting in a huge number of new orders.

“So, these figures are very high,” Freeman said at a briefing in Singapore. However, he also doesn’t believe the orderbook will continue to grow. “All the major yards in Japan, Korea, and China are very close to maximum capacity.” Maximum capacity equates to delivery slots being full until 2030.

Additionally, Freeman explained that even if an owner could find a delivery slot before 2030 there was a shortage of equipment such as piping systems and engines with which to outfit any further newbuilding orders.

Meanwhile with the VLCC spot earnings from Arabian Gulf to China hitting over $1 million a day and one-year charter rates 176% year-on-year to $135,124 daily, secondhand and resale values are also soaring.

Five-year old VLCCs are the most overvalued asset that Veson tracks and current values are 133% higher versus their 1992 – 2026 median. Newbuilding resales have hit levels of $200 million in the past few weeks. “So, these really are uncharted waters,” commented Freeman commented.