By Nikolas Tsakos
Mr. Nikolas Tsakos is the president of INTERTANKO [ President and CEO of Tsakos Energy Navigation (TEN). The text is based on his address delibered at the Piraeus Marine Club.
My Association represents 75% of independent tanker owners and 90% of gas carrier companies (recent event). It consists of 210 full members, 260 associate members, 4,000 vessels from 65 countries, with Greece and Japan being the largest participants.
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It is globally represented with a North American panel, South American panel (meeting in Rio in October), a growing Far East panel, the Mediterranean and Northern European panel and 14 very active committees, with huge support from members. A very vibrant organization!
INTERTANKO was established in 1970 in Oslo, in the aftermath of the ‘then’ oil crash that followed the 6-day war in the Middle East. The founding members represented the big names in Scandinavian, Far Eastern and Greek shipping (Jahre, Naess, WKPAO, Onassis, Niarchos). Their aim was to protect the owner’s interest in the changing oil world of the early ‘70s.
The repeat oil shocks of 1973 and 1979, together with the long shipping crisis of the 1980s, gave further strength and purpose to INTERTANKO’s commercial support to its members (WKPAO, Papachristides). So for the first 20 years, INTERTANKO’s role was of commercial support to its members.
The aftermath of the ‘Exxon Valdez’ and the OPA '90 legislation that followed, together with the enduring discussions about the Double Double design, naturally turned INTERTANKO’s focus to technical issues for most of the ‘90s.
The ‘ERICA’, the ‘PRESTIGE’, ‘the PIRACY’, and other such grave issues required more legal support for members in the early part of the 21st century.
Then the unprecedented crisis following the 2008-09 post Lehman collapse and the oversupply of tonnage from the “bubble’ days turned INTERTANKO’s focus back to its ‘roots’; the ‘Commercial Sustainability of its members’ together with top tier technical support.
Today, environmental challenges such as water ballast, SOX-NOX, questionable dirty scrubbers, the 0.5% issue and more, require technical expertise and guidance for our members.
However, they are not tanker specific. We are co-operating closely with all roundtable stakeholders with BIMCO, INTERCARGO, ICS, the Coast Guard and IMO, to find the appropriate solutions going forward.
At INTERTANKO, we focus on the safe, efficient, environmentally fit operation of our vessels and the commercial sustainability of our members.
Being sensitive to our member needs, we reduced the fees by 20% this year, making it a 35% discount since 2010.
Our fee reduction is just a drop in the ocean. What the industry needs with it is logical commercial changes, unified inspections, standards for tankers (vetting) charter party corrections with, payments in advance to stop the curse of late payments of hire and demurrage.
We still base our spot earnings (how little they are), on the non-transparent, arcaic, worldscale system. We are continuously financing global oil transportation by getting paid months in arrears for providing a first class service.
We don’t have to reinvent the wheel. We should follow dry cargos, containers and LPG and all payment terms, paid in advance. The complicated WS system is also preventing the expansion of a liquid futures market in tankers also. The arrears payment of freight, coupled with delays in collection and demurrage, reduces our already small daily income by approximately US$200.
Of course, however important it is to change this anomaly, it is not the main cure for our industry. The oversupply of un-needed N/B tonnage is the real problem.
INTERTANKO is the platform to assist members with tanker specific issues and co-operate closely with the Roundtable participants, most of it Greek today, on issues of common interest.
