According to a research report released by Guotai Haitong Securities Co., Ltd. (ASX: 601211), two phases have created a super bull market in oil shipping: in 2022, trade restructuring lengthened voyage distances, and in 2025, the benefits of increased crude oil production will materialize.
The report maintains an overweight rating on oil shipping, stating that the prolonged high prosperity will exceed expectations.
Oil shipping has already entered a high-prosperity phase, and the escalation of the Middle East situation in 2026 provides an opportunity for gray market changes.
It is suggested to pay attention to the continued impact of gray market changes, as oil shipping is expected to see an ultra-high and sustainable boom, providing dual space for both performance and valuation.
The main views of GTHT are as follows:
Focus on gray market changes: Expected to increase compliant demand, accelerate the clearing of old vessels, and achieve an ultra-high and sustainable boom
Rate tracking: Oil shipping rates have eased from highs, and dry bulk large vessel rates have stabilized.
1) Crude oil shipping: Iranian attacks and high freight rates have suppressed some demand, and the industry expects the actual impact of shadow fleet sanctions relief to be limited; 2) Refined product shipping: Trade recovery drives high freight rates. Short-term quotas continue, medium-term trade restructuring, and long-term refinery migration eastward; 3) Dry bulk shipping: Falling iron ore prices have slowed mine shipments, and large vessel rates have stabilized. In the future, pay attention to the production increase at Simandou; 4) Container shipping rates: Main routes have entered the traditional off-season, and liner companies are expected to actively reduce sailings to stabilize prices. Pay attention to European and American Christmas consumption.
Oil shipping: Two phases create a "super bull market"
Phase one: Geopolitical conflicts drove the restructuring of global crude oil trade, with Russia and Europe "seeking distant sources instead of nearby ones," lengthening voyage distances. This drove the oil shipping boom to rise across years for more than three years, and capacity utilization rose to a threshold.
Phase two begins: Global crude oil production increases, driving continued growth in oil shipping demand. The rigid effective supply of tankers continues, and future supply and demand will continue to improve with the boom rising, and there is an unexpected option from gray market changes.
Dry bulk: Long-distance iron ore production increase begins, and the boom is expected to gradually rise
In 2021-22, benefiting from the ultra-high boom in the container shipping industry and demand spillover, container-to-bulk conversion drove freight rate performance. In 2023-24, post-pandemic recovery growth drove a moderate rise in the dry bulk shipping boom. The global iron ore production increase cycle has begun, especially the super-large Simandou project has been put into production and will continue to increase output, and demand growth exceeding expectations is anticipated. In the coming years, supply will grow at a low rate, and the boom is expected to gradually recover.
Container shipping: Tariff easing returns to a new normal, focus on the new China-US trade landscape
Over the past five years, there have been two rounds of high prosperity, and the profit base has risen. In the first half of 2025, China-US tariff friction caused short-term large fluctuations in trade and freight rates. In Q3, trade returned to normalization and the main route peak season was not strong. In the coming years, main routes will again face ship upsizing and supply pressure. The suspension of Section 301 sanctions is in line with expectations. Pay attention to the new China-US trade landscape and the economic impact of energy pressure. It is suggested to continue to pay attention to structural growth and opportunities in the container shipping market.
Risk warnings: Economic risks, geopolitical situation change risks, environmental policy implementation risks, etc.
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