Guyana’s expanding oil production is helping create more work for tanker owners as growing volumes of crude from the Americas are shipped to buyers farther east, according to S&P Global.
The trend is part of a wider increase in Western Hemisphere crude supply from Guyana, the United States, Brazil and Argentina. More of those barrels are moving across longer trade routes to reach major consuming markets in Asia.
International Seaways CEO Lois Zabrocky discussed the development during the company’s second-quarter earnings call on August 10.
“When you really drop back and take all the horrible war effects, all of the war in the world out of the equation, you see the fundamental West increasing, the East demanding that crude,” Zabrocky said.
Guyana has become one of the fastest-growing sources of new crude in the Americas since production began at the Stabroek Block. Output has surpassed 900,000 barrels per day, with further increases expected as additional projects come online.
Guyana “may have” already surpassed first billion barrels of oil produced – Routledge | OilNOW
Brazil is also adding offshore barrels, while higher U.S. production and growing Argentine output are expanding the pool of crude available for export.
For tanker owners, the significance is not only the number of barrels entering the market but also where those barrels are going. Longer voyages between producers in the Western Hemisphere and consumers in Asia require more tanker capacity.
“One of the things that we’re seeing very significantly now in the tanker market between the VLCCs [very large crude carrier], the Suezmaxes, particularly the Aframaxes, is a lot of dislocation and substitution by charters between sizes so that you’re really seeing a lot of overlap between the sectors,” Zabrocky stated.
According to S&P Global, International Seaways is positioning for some of that regional demand. The company has ordered four long-range 1 tankers for delivery in the second half of 2028, following six similar vessels ordered three years ago.
“We have a very strong customer base in the Americas…This combination has proven over time to be a very reliable niche trade, so we intend to continue,” Zabrocky explained.
