00:00Let me first ask about your take on the importance of the Strait of Hormuz.
00:04There was a time when analysts would tell us if that closed, we would see a total catastrophe in the
00:12energy markets.
00:13And that just doesn't happen. Is it maybe less important than we thought to begin with?
00:19Well, good morning and thank you for having me.
00:22Actually, no, it's extremely important.
00:24And the way that we have been losing so much barrels of oil and natural gas from the markets, it's
00:30kind of tremendous.
00:31The way that it hasn't really been a catastrophe so far is the fact that we have been using a
00:37lot of the inventory.
00:38So that's going to run out pretty soon.
00:40So, you know, it's just a matter of time where we see a big, big depletion of the global reserves
00:46of oil and natural gas from what it seems.
00:49So my kind of optimistic assessment was that maybe investors and industries were finding alternate routes.
00:58And you operate some of those alternate routes.
01:01So have you seen increased demand for other routes as people can't use the Strait of Hormuz?
01:08Well, there are certain aspects of the energy market that are kind of irreplaceable.
01:12You cannot replace oil from a number of, you know, the petrochemical industry or jet fuel or things that are
01:19pretty, pretty important, very important in our daily life.
01:22So that goes without saying that it's kind of irreplaceable.
01:26There are, of course, alternative routes.
01:28The U.S. has come in to, you know, pick up the slack in a number of ways of the
01:32global oil demand.
01:34But this is not close to being enough from what it seems for this year.
01:39So we're still eating a lot of the reserves.
01:41And, of course, longer distances means longer toned miles, more toned miles.
01:46And that makes freight to be more expensive for everybody.
01:50And most importantly for the consumer, the end consumer paying for everything.
01:55What about the coal shipments, the stronger coal shipments headed to Asia?
02:01Is that a temporary, you know, energy security trade due to the closure of the Strait?
02:07Or is that a longer term reality for coal and for Asian economies?
02:14Well, there's a number of power plants in the Far East that are being fueled by coal.
02:20And there's more and more of them being built as we speak.
02:24So the recent crisis in the Hormuz and the Persian Gulf, it's just another giant alarm bell that the world
02:32should not be so much reliant on oil to the extent possible, of course.
02:36So coal is becoming dominant again for two reasons.
02:40Number one, we are replacing the current energy required, you know, for day-to-day lives, especially in the Far
02:48East.
02:49China has been restocking massive amounts of coal in the recent months.
02:53And most importantly, coal is also becoming a strategic commodity for the United States.
03:00They are exporting, you are exporting more and more quantities of coal to the West Coast of India and a
03:07number of other places in the world.
03:08So coal, I'm not saying it's going to become dominant over the period of the next 10 years, but certainly
03:14in the short term, it's becoming quite important in the energy market.
03:18You know, I think about energy and we talk about energy so much when it comes to the big data
03:24center build out, the AI infrastructure.
03:26You point out, though, Stamatis, that it's also steel, aluminum, iron ore, bauxite that's needed for putting up data centers,
03:36for grid improvements, obviously for EVs to build the cars to begin with.
03:43Is that visible in the cargo flows today?
03:47Of course. I mean, and this is exactly what we do.
03:49We transport the world's most important commodities, raw materials for infrastructure.
03:54You have trillions of dollars of global infrastructure projects all over the world.
04:00You have now the data centers, which also is going to be trillions of dollars of demand for aluminum and
04:06steel and all that.
04:07So that's what we do. We transport iron ore, bauxite and coal required in order to produce these super required
04:14commodities for the world growth of tomorrow.
04:18So it's not just the energy market.
04:19It's simply all the infrastructure happening around the world, which we kind of be neglecting, given all the crisis that
04:27we have to deal with.
04:27Your diesel prices have, I imagine, risen substantially.
04:33Tell us about those costs for you and how well you've been able to pass them on to your clients,
04:40your consumers.
04:42Well, as I mentioned before, freight is becoming more and more expensive.
04:46So at the end of the day, the consumer is who pays for all this increased cost.
04:51So increased bunker fuel for our ships, as well as a massive increase in ton miles that is required to
04:59go around all these problematic areas like the Red Sea, like the Persian Gulf and all that.
05:04That is an increasing inflationary pressure for the consumers.
05:09There's nothing we can do about it.
05:11I mean, there's no way that you can cut through, you know, a military or a war zone.
05:15So, unfortunately, all the ships have to go around certain areas like the Cape of Good Hope and all these
05:20other critical areas.
05:21So, unfortunately, all that is being translated to the end consumer.
05:27You also have a fleet renewal program and you pay a dividend.
05:32How do you balance returning cash to shareholders with buying new tonnage before, I guess, the next cycle turns or
05:41the war ends?
05:43Well, right now, our new building program is close to an exceeding soon half a billion dollars.
05:49So we're in the process of renewing our fleet over the course of the next three, four years.
05:54But still returning capital to our shareholders and generally, you know, dividends and cash back to our shareholders is for
06:02us paramount importance.
06:04So we will continue doing both, not only replacing our fleet and renewing with high quality assets that will be
06:11delivered to us over the next two to three years,
06:14but also we will continue a very strong return to our investors.
06:18Something I also wanted to mention about before, which is, again, close to the energy markets, it's the El Nino
06:25effect.
06:25Don't forget that 2026, forecasters believe there's going to be an 80% chance of El Nino.
06:32And that means that there's going to be a very increased need for energy happening from the summer months and
06:39towards the second half of the year.
06:41China, Far East, Japan altogether and, you know, Korea will be in massive needs of energy.
06:48And that cannot come from, you know, oil and natural gas being trapped in the Persian Gulf.
06:53We're talking about massive amounts of coal happening in the next few months as well.
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