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    North Sea broker sees signs of trouble ahead

    News // January 16, 2009

    Shipbroker Offshore Shipbrokers Ltd (OSL) in the UK says it sees "plenty of signs of trouble on the horizon" for both operators and shipowners in 2009.

    "Firstly the global financial crisis is claiming further victims with financing becoming not only expensive but also hard to come by," said OSL, noting that†Oilexco North Sea Ltd issued a statement over the festive season stating that they would be filing petitions for administration as soon as reasonably practicalafter failing to raise additional funding.

    "There are also numerous operators showing signs of cutbacks in exploration expenditure with several rig requirements for 2009/2010 having been recently withdrawn or postponed indefinitely," said OSL.

    "It would also seem that several operators with rig charters already in place are now offering sublet slots in order to fill in periods as a result of cancelled drilling programmes."

    "There was however a brief glimmer of hope for operators over the festive period as oil rallied from its low of US$36 during December to over US$50 on the current instability in the Middle East and supply fears," said OSL in its latest monthly report.

    The US has however recently posted some very poor unemployment and manufacturing data along with increasing stocks of oil which have sent the price tumbling rapidly back below US$39 at the time of writing.

    "All of the above points to signs that the demand for vessels in the North Sea is dropping off somewhat more rapidly than expected and looking at the other side of the coin, supply, it is clear to see a steady stream of new tonnage continuing to head our way," said OSL.

    "For 2009 there are currently expected to be in the region of 64 North Sea Standard PSVís (>2500dwt) due for delivery with 27 having contracts. There are however some 73 AHTS of >12,000 BHP currently on order worldwide with only a small percentage having contracts upon delivery."

    "Looking at 2010 it would also seem that there is not much let up in expected newbuild deliveries," OSL concluded.

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