Oil price prompts FPSO rise

The sustained high price of oil has prompted upbeat attitudes from oil companies towards offshore oil production, as marginal fields become more viable. In response to this, Hyundai Heavy Industries (HHI) has predicted a boom in oil construction facilities in the next five years. This could, in turn, trigger a demand for FPSOs, with HHI predicting the ordering of as many as 20 new oil production facilities. As there is likely to be a glut of 1970s built tankers on the market in the near future, the FPSO route could prove particularly attractive. FPSOs do not have to comply with IMO regulations and are therefore not subject to the phase-out of single hull tankers.