19 November 2008 18:11 [Source: ICIS news]
HOUSTON (ICIS news)--The average confidence level of ship owners, managers and brokers who responded to a shipping survey was 5.6 in November, down from June's 6.8, according to a UK study released on Wednesday.
The latest Shipping Confidence Survey by UK consulting firm Moore Stephens shows a sizable drop in confidence levels since June and increased expectations that tanker rates and those for other shipping sectors will fall in the next year.
The firm's June survey scored the average confidence level at 6.8 on a scale of 1-10. Since then, oil prices have fallen by more than 60%, and talk of a global recession has snowballed, precipitated by a credit crunch among the world's largest financial institutions.
Moore Stephens partner Richard Greiner said the latest survey found growing concern across all shipping markets about weakening demand in the global economy.
Greiner said evidence from respondents showed that the global economic downturn and the credit crunch "are starting to bite".
The survey noted that only the strongest shipping firms would survive the tough market conditions, and there was evidence of a prejudice against first-time customers.
“Right now we prefer not to work than to work and not get paid," said an unnamed operator quoted in the study. "So we will rely on regular customers or at least on new ones whom we know we can trust.”
The study also noted a significant shift in expectations about freight rates, particularly in the tanker and container ship markets.
In the tanker market, 52% of respondents expected rates to fall, which was a reversal of their attitudes in June, when 45% expected rates to rise.
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