The demand for oil tankers may decrease as early as 2028 due to a gradual decline in demand for fossil fuels such as gasoline and diesel. Consequently, the global oil tanker construction industry will inevitably experience rebalancing, fleet adjustments, and order reductions.

Currently, the tanker market is on the rise. Since 2023, it has been fueled by an increase in the volume of the “shadow fleet” by sub-sanctioned countries and an increase in the duration of voyages through Suez and the Red Sea amid tensions with the Houthis.

However, in the long term, analysts expect this market to decline, requiring fleet adjustments through controlled orders. With global trade in petroleum products declining, tanker carriers’ orders will be limited to spare tonnage to meet strict environmental regulations rather than depending on demand forecasts. Orders may fall below tanker replacement due to tanker obsolescence, notes industry publication Helenic Shipping News.

The decline in trade volumes will lead to a gradual reduction in the fleet and the overall tanker business in the long term. Shipping rates will remain volatile and cyclical depending on the supply-demand balance.

The IEA forecasts that gasoline demand will decline by 0.2 million b/d from 2026 and diesel demand will fall from 2027. Starting in 2028, the total motor fuel market will gradually decline due to a shift to electric vehicles. The main drop in demand will occur in Europe and North America, while demand for oil and oil products in APAC, Africa, and Latin America will increase.

The market expects a reduction in refinery capacity in the Atlantic basin by 0.6 million barrels of oil per day until 2030. Meanwhile, refineries in Asia and other countries east of the Suez Canal will continue to expand capacity by 2.7 million bpd during the same period.