Sustained lower oil prices have offshore supply vessel companies running out of options

Over the next few years, offshore supply vessels (OSVs) will have to confront their new reality: lower demand, shorter charter contracts, and reduced day rates.

At a glance

• 2017 could be one of the worst years in decades for OSVs.
• The Gulf of Mexico has been a brutal place to operate, the North Sea market remains depressed, Brazil remains subdued, and exploration and production activities in Southeast Asia have declined.
• With excess shipyard capacity, numbers of OSV operators and OSVs, and debt, companies will have to be diligent and take radical steps to survive.
• On the bright side, positive trends including M&A opportunities, effective cost reductions, and stronger capacity discipline are on the rise.