The South Korean shipbuilding industry is experiencing a surge in Suezmax-size tanker orders from global shipowners as the ongoing war in Ukraine encourages more tankers to move through the Suez Canal.
Suezmax tankers are the largest tankers capable of going through the 20-meter-deep Suez Canal, which is the shortest route between the Indian Ocean and the Mediterranean Sea. These tankers are some 275 meters (900 feet) long with a deadweight of about 160,000 tons. They are mostly used for shipping crude oil.
A Liberian shipowner placed an order last week for two Suezmax-size tankers from Hyundai Samho Heavy Industries, a shipbuilding affiliate of HD Hyundai Heavy Industries, and the world's largest shipbuilder, according to industry insiders on Monday. The tankers, with a price tag of $85.2 million per vessel, are expected for delivery in June 2026.
An Oceania-based carrier also ordered two Suezmax tankers from Hyundai Samho Heavy Industries last month, scheduled for completion by the first half of 2026. The order was valued at a total of $85.5 million.
Daehan Shipbuilding, a mid-sized South Korean shipbuilder, secured a total of seven Suezmax tanker orders this year. Discussions for additional contracts involving four to five vessels are reportedly underway. Samsung Heavy Industries has also received orders for two Suezmax tankers this year.
A total of 58 Suezmax tankers have been ordered globally in 2023, which is the highest figure in the past decade. The war in Ukraine has affected how crude oil is being delivered, driving up demand for Suezmax tankers.
India has been relying on Suezmax tankers to import Russian crude oil to European ports, after the import ban on Russian crude oil sent prices lower. European countries are importing more crude oil from West Africa, the Middle East, and the US to replace Russian crude oil.
For the Korean shipbuilding industry, crude oil tankers have emerged as the next lucrative sector following liquefied natural gas (LNG) carriers and large container ships.
"Despite a slow start, shipbuilding orders rebounded in the second half of the year, surpassing the building capacity of Chinese and Japanese counterparts," said an industry insider.
This article was originally published on Nov. 13, 2023.