ShippingWatch

Nordea: Offshore can go from bad to worse in 2016

If the oil price settles at the current level, it will only be a matter of time before we will see the first restructurings in the offshore industry, Nordea’s Head of Shipping & Offshore, Hans Christian Kjelsrud, tells ShippingWatch.

Supply ships have been laid up. Oil rigs have been removed from the market. Energy companies are firing workers by the thousands. But so far, major global lenders in shipping and offshore, such as pan-Nordic bank Nordea, have yet to see a marked effect of it in their business with major carriers and subcontractors, who depend on contracts with the oil companies and have made a killing off of inflated oil prices in recent years. The reason being that most customers are still living off the fat of contracts signed before the oil price plunge.

Although the oil price has been cut in half in the last year, leading to dramatic consequences for many employees and the cancellation or significant alteration of many contracts, it has yet to take its toll on the players who put up a large share of investments in, say, the North Sea.

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