Tanker stocks plunge after Trump’s ceasefire message

ASIAN shipping stocks, especially tanker shares, quickly retreated on Tuesday after news emerged that Iran and Israel have agreed to hold ceasefire talks.

Cosco Shipping Energy Transportation, one of the world’s largest tanker owners, led the decline with its Shanghai- and Hong Kong-listed shares tumbling 7% and 9.8% respectively, by the midday break.

Its domestic rival, Shanghai-listed China Merchants Energy Shipping, fell by nearly 7%. Together, the two Chinese state giants own more than 100 very large crude carriers.

This came after US President Donald Trump posted on social media on Monday that Tel Aviv and Tehran have agreed to “a complete and total ceasefire” to be phased in over 24 hours, although the situation remains unclear.

Iran’s Foreign Minister Abbas Araghchi denied any “agreement” was reached but said “we have no intention to continue our response afterwards” as long as Israel stops attacking before 0400 hrs Tehran time.

However, after the deadline, Israel reported detecting another barrage of missiles fired from Iran. Prime minister Netanyahu’s government has yet to publicly comment on the truce.

US-listed tanker stocks started falling yesterday after Iran launched a symbolic missile attack on an US military base in Qatar.

Previously, investors had been buoyed by escalating tensions in the Middle East and the growing risk of a closure of the Strait of Hormuz, following strikes by Israel and the US on key Iranian nuclear facilities.

The developments underscore, once again, how increasingly volatile geopolitics has become the biggest driver shaping shipping markets in recent years.

In its latest market report, Maritime Strategies International said VLCC spot earnings could retreat to $43,000 per day in the third quarter from more than $70,000 currently, if no substantial flare up occurs in the Middle East conflict.

Conversely, if escalation occurs — such as restricted passage through the Strait of Hormuz — VLCC spot rates could exceed $100,000 per day.

“This initial reaction would again be due to further shock, however, in the long-term, markets would likely fall again due to lower cargo volumes and weaker macroeconomic conditions.”

Pareto Shipbrokers said: “Spot rates surged further yesterday, with eco-scrubber VLCCs nearly reaching $100,000 per day. However, with the situation now seemingly completely changed, we should expect plenty of ‘failed’ spot cargoes, and rates should fall back again.”

That said, it expects that third-quarter revisions will remain positive, suggesting the brief conflict could prompt greater attention to supply chains and stockpiling.

The broker added that the key issue for VLCCs is the future of Iranian oil exports; if a deal is reached and sanctions are lifted, the roughly 135 super-large tankers transporting these cargoes may face increased scrutiny.

Pareto said that the main investment narrative for crude tanker companies remains centred on increase in Opec+ output and potential cargo oversupply in the second half of the year.

“[That’s] a story that probably is even more valid now if we avoid a full-scale Middle East war.”

Lloyd's List Daily Briefing 25 June 2025

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