DooDiligence Posted August 19, 2020 Share Posted August 19, 2020 Why do you see it as a trade? The order book is at an all time low, while the fleet age is approaching an all time high. There are absolutely no signs of that changing. Stick around for a few years and wait for the supercycle... So, first this is a bet on scrubbers/ IMO 2020 that didn’t work out (YE2019) , then it was a bet on using tankers as floating storage to bet on crude contango (April 2020) that didn’t work out, now it’s a bet on a tanker shortage supercycle (unknown future)? Just as a heuristic, I can’t say that thesis creep has worked for me very often. You also have to bet that management doesn’t do anything stupid in the meantime, even if we get a supercycle some time down the road. That’s not something one can take for granted in the tanker space. Fully agree! But given today's price there isn't much that has to go right. Question to the bulls....what would have to happen for you to become a bear. I mean what would have to go wrong. And a separate question...if I want to learn more about crude and product tankers are there some good resources? https://moiglobal.com/tankers-the-pendulum-swings-back-201910/ "IMO 2020 represents a great opportunity for the Product tanker segment. The need of compliant fuels and their storage in almost every single port imply more cargo moves around the globe." "Leverage matters a lot. Many participants feel that non-recourse debt (i.e. attached to vessels which do business by their own as separate legal entities) is a wildcard that can be drawn at convenience." --- www.rivieramm.com/news-content-hub/why-did-oaktree-capital-management-buy-a-stake-in-tanker-shipmanager-osm-23831 --- www.rivieramm.com/news-content-hub/tanker-orderbook-continues-to-shrink-60523 "...product tankers is the only segment to have seen higher contracting this year than last, up 2.9% in the first seven months of the year at 3.2M dwt, though orders for new crude oil tankers have fallen 41.3% in the same period, a drop from 10.1M dwt last year to 5.9m dwt this year." --- edit: this report deals primarily with crude tankers & includes info on survey requirements & costs based on the age of the vessel. www.euronav.com/media/65361/special-report-2017-eng.pdf Surveys include not only the obvious hull testing but also tests of oily water separators OWS & ballast water handling systems & close scrutiny of record keeping. Poor logbooks can mean big fines & additional delays due to prolonged deep inspection. Link to comment Share on other sites More sharing options...
Saluki Posted August 19, 2020 Share Posted August 19, 2020 That Euronav presentation is great! Shipping is a weird business. The Shipping Man is a fun novel where the main character is a hedge fund manager who buys a tramp steamer (Bulk Shipping) and learns about the business by doing everything wrong. The Noreweigan guy he partners with is probably based on the CEO of Frontline. I read the Business of Shipping, a textbook (NERD!) which has a little bit of everything (containers, bulk, tankers etc) and drilled down from there. Listen to earnings reports, read the presentations and 10-ks. It's not magic. It's a terrible cyclical industry but when it turns it usually turns hard and you can make a lot of money (or lose a lot). As for what it would take to go bullish? If there is a sustained downturn in demand for refined products (due to a recession or whatever) AND in increase in the order book for product tankers, then I would run for the hills. But right now we seem to have the opposite, high rates (if not caused by increased economic activity, at least caused by disruptions in usual routes and consumption patterns) and a very small order book. Even though the IMO2020 thesis hasn't played out (because the price difference between high sulfer bunkers and low sulfer hasn't widened, leading to faster scrapping of older ships), STNG does have the youngest fleet and if new ships aren't built fast enough to replace the ones scrapped due to age, it should do well. Link to comment Share on other sites More sharing options...
Saluki Posted August 19, 2020 Share Posted August 19, 2020 One of the Lauro family affiliates purchased $1.2million in STNG on the open market. https://finance.yahoo.com/news/scorpio-tankers-inc-announces-purchase-212800209.html They purchased about $70 million (if I recall correctly) in SALT during the recent equity raise, so this isn't that big a deal, but I'd rather be buying alongside the Lauro's (or selling) then being on the other side of the trade. Link to comment Share on other sites More sharing options...
SafetyinNumbers Posted August 19, 2020 Share Posted August 19, 2020 I thought this was a good update with Bugbee. Some of the older ones with him are good listening too. Link to comment Share on other sites More sharing options...
benchmark Posted August 27, 2020 Share Posted August 27, 2020 Any reason for the big drop today? Link to comment Share on other sites More sharing options...
Saluki Posted August 28, 2020 Share Posted August 28, 2020 Everything that floats went down yesterday. I didn't see any news. Anyone find anything? Link to comment Share on other sites More sharing options...
rukawa Posted August 30, 2020 Share Posted August 30, 2020 How does the increase in oil production effect tankers. My understanding was that product tankers ship refined products. Is it because some product tankers switch to shipping or storing crude? I'm wondering because the over-production can't last forever. When it stops day rates for product tankers should go down. Is that what the market is anticipating and why the price continues to be low? Link to comment Share on other sites More sharing options...
influx Posted September 2, 2020 Share Posted September 2, 2020 Everything that floats went down yesterday. I didn't see any news. Anyone find anything? Not really STNG related, but I've been following EURN for the past 5-6 months, looks to me as a dividend related cycle. But maybe wrong. Link to comment Share on other sites More sharing options...
rukawa Posted September 6, 2020 Share Posted September 6, 2020 Everything that floats went down yesterday. I didn't see any news. Anyone find anything? Not really STNG related, but I've been following EURN for the past 5-6 months, looks to me as a dividend related cycle. But maybe wrong. Where are the rates on tankers? How are you guys finding this information? Link to comment Share on other sites More sharing options...
Gamecock-YT Posted September 6, 2020 Share Posted September 6, 2020 the holding company was in the market last week with $2.3MM in purchases. They are getting a little bit more aggressive purchasing shares since the share price continues to languish. Link to comment Share on other sites More sharing options...
DooDiligence Posted September 6, 2020 Share Posted September 6, 2020 Everything that floats went down yesterday. I didn't see any news. Anyone find anything? Not really STNG related, but I've been following EURN for the past 5-6 months, looks to me as a dividend related cycle. But maybe wrong. Where are the rates on tankers? How are you guys finding this information? www.globenewswire.com/news-release/2020/06/18/2049978/0/en/Scorpio-Tankers-Inc-Announces-an-Update-on-Daily-TCE-Rates.html Link to comment Share on other sites More sharing options...
keerthiprasad Posted September 6, 2020 Share Posted September 6, 2020 Can find rate averages on Twitter. Link to comment Share on other sites More sharing options...
rukawa Posted October 28, 2020 Share Posted October 28, 2020 Its at an all time low now. Link to comment Share on other sites More sharing options...
influx Posted October 28, 2020 Share Posted October 28, 2020 I was told VLCC Fixtures Android app is relatively good. Anyone has any experience? I think there might be a desktop app as well Link to comment Share on other sites More sharing options...
influx Posted October 29, 2020 Share Posted October 29, 2020 https://www.freightwaves.com/news/why-crude-tanker-collapse-could-be-long-and-painful Link to comment Share on other sites More sharing options...
gfp Posted January 14, 2021 Share Posted January 14, 2021 This one appears to have bottomed finally. The President, Bugbee, just keeps doing these open market call option purchases - which strike me as strange and aggressive. He has had at least one expire out of the money recently, I believe. Undeterred apparently. Now at least he chose an in-the-money strike. https://www.scorpiotankers.com/scorpio-tankers-inc-announces-purchase-of-call-options-by-president-of-the-company-6/ (for context, here are the 2020 press releases with the previous call buys / share purchases by sponsor) https://www.scorpiotankers.com/media/company-news/?news-year=2020 Link to comment Share on other sites More sharing options...
Saluki Posted May 17, 2021 Share Posted May 17, 2021 13Fs are out. Looks like Michael Burry bought some of this and a couple of other things in shipping. https://www.dataroma.com/m/holdings.php?m=SAM Anyone have thoughts on the timing? Link to comment Share on other sites More sharing options...
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