Hosking Partners LLP on Hafnia Limited
Thesis
Hafnia is part of Hosking Partners energy-shipping basket built on the capital-cycle thesis that years of underinvestment left the tanker fleet structurally supply constrained. Disruptions to global oil flows, especially around the Middle East, increased vessel demand and supported freight rates. Hosking says this shipping basket has delivered very strong long-term returns since its original 2017 thesis. As higher rates stimulate fresh equity issuance and ship orders, the firm is slowly reducing exposure while retaining part of the position.
“the withdrawal of capital had created a supply-constrained industry which has played through with rising day rates”
Key risks
- New tanker orders and equity issuance can erode the industry's supply shortage.
- Normalizing Middle East and other geopolitical energy disruptions may depress freight rates.
- Tanker day rates and earnings remain sensitive to changes in global oil-shipping demand.