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Author: PosFCF Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 454826  
Subject: Re: Hat tip to Hohum Date: 3/22/2013 12:45 PM
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Just a thought on the subject of tankers. The US has gone from importing 60% on its oil needs mostly by tanker to importing just 32% and much of that by pipeline. The new customer for much of that oil is China that is a much shorter run for tankers and also receives oil by pipeline from some suppliers.

I have not really spent as much time as I would like to look at the numbers but this may be part of what is behind the fall in tanker stocks?


Well, Hohum's really the expert in this area, not I. However, I think the shipping industry entered into a new build frenzy which was exacerbated by China building many of its own ships. The overcapacity drove down the day rates to very unprofitable levels and that then drove the share prices of shipping companies into the dirt.

The best of the shipping companies pared back and refocused (as capitalism is intended to do in such environments) and now a few of them have debt levels and revenue streams that merit consideration.

Poz
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