NEW YORK (The Street) -- The choppy waters roiling the oil market are creating waves of profits for the global tanker industry, says Anthony Gurnee, CEO of Ardmore Shipping.
"We've been in a new phase in our business since the collapse in the price of oil last November," says Gurnee. "Year on year charter rates have doubled and the real driver is oil price volatility which creates trading opportunities for our customers and sends our ships on longer voyages."
Shares of Ardmore have risen 17% to more than $12 in the past 6 months as oil prices have gone on their wild ride. A barrel of oil was over $100 last summer before dropping to the mid-$40 range this past December. And while the price of crude has climbed back near the $60 level, Gurnee says the tanker companies still see a "glut" in the market.
"Oil is off the bottom, but it's still way below where it used to be when it was reliably trading in triple digits," says Gurnee. "We think we are in a new phase in the oil market where oversupply and market forces will dominate as opposed to OPEC."
A lot of the refined product hitting the market is coming from the U.S. Gulf of Mexico where exports have increased about 10% a year for the past 5 years. Gurnee says his ships are transporting more refined product than ever out of the U.S. Gulf, as well as in the Middle East where refineries in countries like Saudi Arabia have come on line in the past 3 months, increasing demand for Ardmore's ships.