A MEETING between Taiwan's President Tsai Ing-wen and us Speaker Nancy Pelosi last summer caused China to conduct live-fire exercises, while a recent meeting with Speaker Kevin McCarthy led to new Chinese sanctions against US interests and a Chinese inspection plan for commercial ships in the Taiwan Strait, reports New York's FreightWaves.
Recently, Chinese warships and helicopters were active in the strait, reflecting the worsening relations between China and the US and the increasing division of shipping fleets and cargo flows.
The World Trade Organisation has warned of a 'long-run decoupling' scenario, where the global economy splits into two blocs, with a 'geopolitical rivalry' featuring a 'bipolar trade war.'
This has resulted in the bifurcation of global shipping systems, with the US and EU leading one side, China and Russia leading the other, and some countries trying to stay neutral.
While the geopolitical schism is initially positive for tanker shipping rates, it may turn negative in the future.
Geopolitics has caused a bifurcation in the tanker fleet, with tankers transacting in US dollars and using Western insurance and finance providers on one side and the so-called 'shadow fleet' on the other, which represents 10 per cent of global tanker tonnage, and does not transact in dollars and does not use Western services.
Oil demand over the long term benefits from higher global GDP growth.
However, a shift towards geopolitical rivalry instead of multilateral cooperation, as estimated by Metivier and Bacchetta in a January WTO working paper, could lead to a 6.4 per cent GDP reduction for developed countries through 2050, a 10.2 per cent loss for developing countries and an 11.3 per cent hit to the least developed countries.
Furthermore, an escalation of the Ukraine-Russia conflict or a military dispute involving the US and China concerning Taiwan is anticipated to have a significantly adverse impact on the global economy, tanker demand, and tanker stocks.
SeaNews Turkey
Recently, Chinese warships and helicopters were active in the strait, reflecting the worsening relations between China and the US and the increasing division of shipping fleets and cargo flows.
The World Trade Organisation has warned of a 'long-run decoupling' scenario, where the global economy splits into two blocs, with a 'geopolitical rivalry' featuring a 'bipolar trade war.'
This has resulted in the bifurcation of global shipping systems, with the US and EU leading one side, China and Russia leading the other, and some countries trying to stay neutral.
While the geopolitical schism is initially positive for tanker shipping rates, it may turn negative in the future.
Geopolitics has caused a bifurcation in the tanker fleet, with tankers transacting in US dollars and using Western insurance and finance providers on one side and the so-called 'shadow fleet' on the other, which represents 10 per cent of global tanker tonnage, and does not transact in dollars and does not use Western services.
Oil demand over the long term benefits from higher global GDP growth.
However, a shift towards geopolitical rivalry instead of multilateral cooperation, as estimated by Metivier and Bacchetta in a January WTO working paper, could lead to a 6.4 per cent GDP reduction for developed countries through 2050, a 10.2 per cent loss for developing countries and an 11.3 per cent hit to the least developed countries.
Furthermore, an escalation of the Ukraine-Russia conflict or a military dispute involving the US and China concerning Taiwan is anticipated to have a significantly adverse impact on the global economy, tanker demand, and tanker stocks.
SeaNews Turkey
