Strategies to mitigate volatility in tanker shipping

Conducting business at an international level, shipping companies are highly vulnerable to uncertainty and volatility. External disruptive events could lead to extensive impacts in many aspects. Current and recent examples include the COVID-19 pandemic, Russia-Ukraine war, Israel-Gaza war, and Red Sea crisis. The objective of this study is to identify and evaluate business strategies employed by tanker shipping companies to mitigate the negative impacts of market volatility. We employ the approach of Quality Function Deployment to find out the most effective shipping strategies based on industry professionals’ inputs. The top three most important business strategies for tanker shipping companies are Tanker pool, Portfolio diversification (market and tanker size segment), and Bunker hedging.