Oil Prices Drop as EU Leaders Meet with Trump
As top EU leaders plan to meet with US president Trump on Monday to discuss strategies to end the Ukraine war, oil prices fell nearly 2% last week, according to reports from cash buyer GMS. The price of oil closed at $62.80/barrel, despite expectations that the easing of sanctions could lead to a decrease in oil trade in the coming weeks. Traders remained bearish about the future of the oil market amidst global economic uncertainties.
Growth in Baltic Exchange’s Dry Index
While oil prices experienced a decline, the Baltic Exchange’s Dry Index saw another week of growth, rising by 0.25%. This marks a 7.24% increase since the beginning of the year and a significant 21% growth compared to the same period last year. GMS attributes this growth to the careful management of tonnage in the shipping industry, with older vessels being phased out and new vessels continuing to be built.
The Indian sub-continent ship recycling markets continue to face challenges due to a slowdown in the supply of vessels. Despite an influx of tonnage in recent months, particularly in Pakistan, the ship recycling industry in the region has struggled over the past few quarters. The ongoing slowdown has led to a surplus of vessels awaiting recycling, creating a challenging environment for recyclers.
Compliance with Regulations in Ship Recycling
The current slowdown in the ship recycling industry has provided an opportunity for non-Hong Kong Convention yards to become compliant with new regulations. However, there is still some confusion in the market regarding these regulations, leading to uncertainty in vessel offerings and pricing.
Prices for vessel recycling have declined in recent months, particularly in Bangladesh where steel products are being stockpiled. Pakistan and India have stabilized at lower price levels compared to earlier in the year, with prices currently around $60/LDT lower than previous peaks. This represents a significant decrease in prices compared to early 2024.
GMS Demo Rankings and Pricing
GMS demo rankings and pricing for week 33 of 2025 are as follows:
Overall, the ship recycling industry continues to face challenges amid global economic uncertainties and regulatory changes. The current slowdown in vessel offerings and pricing highlights the need for sustainable practices and compliance with regulations to ensure the long-term viability of the industry.