RCL adds fourth Oasis ship

Royal Caribbean Cruises has added a fourth newbuilding to its Oasis-class.

It put pen to paper on the contract with STX France as the keel was laid for the third ship in the series today.

Alexander Host, an analyst at ABG Sundal Collier, estimates the latest newbuilding to have cost around $1.4bn, which would mark a rise from the $1.35bn for its predecessor in the series.

Richard Fain, chief executive of Royal Caribbean, says the newbuilding has been added following the success of the first two vessels in the class.

The 5,400-berth Oasis of the Seas (built 2009) and Allure of the Seas (built 2010), are the largest cruise vessels in the world. The un-named third vessel is set for delivery in 2016.

The owner says the fourth newbuilding contract remains subject to financing. No price has been revealed.

Host believes today’s order is neutral for the stock, while the 2018 delivery makes it difficult to chart the supply and demand balance of the market into which it will be delivered.

The analyst explains the cruise sector is not over ordered but it would only take a few contracts to tip the balance.

Seatrade data shows prior to today there were 25 cruise newbuildings on order globally, worth a collective $17.63bn.

Beware the cannibal effect

Host says the Oasis vessels have been profitable for the owner. However, he cautions that Royal Caribbean should be mindful of the cannibalisation effect the larger ships will have on its fleet.

This is the second Oasis ship which STX France will piece together. The first two in the series were built at STX Finland.