Crude oil tanker firm Euronav on Thursday (6 August) published its unaudited financial results for Q2 and 1H 2020 which ended 30 June which reported a profit of USD 259.6 million in Q2, up from USD 225.6 million in Q1.
“Tanker markets continued to deliver strong earnings throughout Q2 and into the early part of the third quarter,” said Hugo De Stoop, CEO of Euronav.
“Floating storage requirements dissipated sooner than expected, pivoting the tanker market to a transition phase ahead of our prior forecast.
“With our sector low leverage, supported by over USD 1 billion liquidity Euronav is very well positioned to navigate challenges and seize opportunities as the market transitions to a lower crude supply and demand dynamic.”
During 2019, Euronav said it purchased 420,000 metric tonnes of compliant fuel and stored it on its vessel, the Oceania (2003 – 441,561 dwt) ahead of the new IMO 2020 fuel regulation.
In view of the significant drop in oil and fuel oil price owing to COVID-19, the Company has actively managed its fuel position by procuring its fuel requirement from both the open market and its stored compliant fuel.
In Q1 2020, the company had to write down the value of the 0.5% sulphur fuel it had in storage “significantly below the acquisition cost” after the oil market collapsed.
The quantity onboard the Oceania on 30 June was approximately 275,000 metric tonnes of compliant fuel and the marked-to-market value was USD -32 million, a much improved position from the last quarter.
The Company concluded that no write down is required at this time but will continue to assess its position each quarter in full compliance with the accounting policy.
Related: Argus Media: Euronav writes down IMO fuel value after price drops
Photo credit: Euronav
Published: 7 August, 2020
‘The drop of profit from this segment was offset by the port management segment which registered a revenue and PBT of RM3.1 million and RM1.0 million,’ it said.
‘The Board accepts the resumption conditions have not been fulfilled and there are uncertainties as to whether the conditions could be fulfilled by end 2020,’ it said.
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