Douglas-Westwood expected "protracted supply overhang" in subsea vessel sectorCompany News // November 16, 2015
Douglas-Westwood (DW) forecasts that global subsea vessel operations expenditure will total US$97.7 billion between 2016 and 2020. It made the prediuction in the 5th edition of the World Subsea Vessel Operations Market Forecast.
Author Mark Adeosun, said: "Low hydrocarbon prices, coupled with vessel oversupply will result in low utilisation impacting expenditure over the forecast period. Despite these near-term concerns, subsea vessel demand is set to recover towards the end of the forecast period.
“As a result of the continued challenging market conditions, subsea vessel providers have been taking additional measures to help strengthen their financial position and stem oversupply in the market by deferring the delivery programme of newly-built vessels.
"We believe that it is unlikely that day rates have bottomed out. Across the global subsea vessel fleet, a 2014-15 decline of at least 30 per cent in day rates is not unlikely before prices stabilise. However, many tier one contractors are joining forces to ensure utilisation and maintain track record.”