French shipbroker BRS Group believes tanker recycling will slow next year as owners are presented with tempting economic reasons to keep older ships trading.

The Paris shop is projecting that only 39 tankers of 34,000 dwt or above will be demolished in 2023.

VesselsValue tallies nearly 60 ships of this size sent to breaking beaches this year already.

Next year’s total will remain above the 2020 nadir of 22 vessels, however.

“We anticipate that tanker demolition activity will remain low next year,” the broker said.

Its forecast assumes that prices for old tankers will remain above demolition values, driven by a requirement to increase the shadow fleet as Russian crude and product exports shift away from mainstream owners.

BRS also believes that, despite new regulations coming into force in January, even the most inefficient vessels will continue to turn a profit for their owners, as earnings remain relatively healthy.

Even those ships compelled to slow down to meet efficiency targets will still be making money, the French company argues.

“Considering that the financing on such tonnage is usually paid off, these tankers should keep training until such a time that a market downturn hits, which would render them unprofitable due to their inability to compete with vessels which can run at higher speeds,” BRS said in its monthly report.

The brokerage also believes sale-and-purchase markets will remain hot.

This year there have been a record number of tanker transactions for further trading, with even vintage vessels changing hands for exceptional sums, the broker added.

BRS again said the need for tankers to join the shadow fleet is playing its part here.

Owners also cannot get their hands on new ships before the end of 2025, if they are ordering now.

And then there is the persistent uncertainty about future propulsion technology to help shipping decarbonise.

This has “undoubtedly seen owners prefer to purchase secondhand tankers rather than order newbuildings”, BRS added.

“Even considering our expectations for an uptick in ordering activity in 2023, all signs point to these factors persisting next year.”