The global offshore supply vessel (OSV) fleet is steadily aging because very few new vessels are being built. After the 2014-2015 oil price crash, newbuild orders nearly stopped. From 2018 through 2023, only 177 new OSVs were delivered, and just one of those was delivered in the United States. At that point, the fleet’s average build year was 2006, and vessels over 20 years old accounted for about a quarter of total tonnage.

More recent figures show the trend continuing. More than half of the roughly 3,200 working OSVs worldwide are now over 15 years old. The order book stands at just 216 vessels, which is minuscule for a fleet of that size, especially considering that the global OSV order book in 2011 was nearly 1,000 vessels. Also of note, the laid-up fleet, which topped 1,500 vessels during the COVID-19 pandemic, is down to fewer than 400, and many of those vessels are not worth reactivating.

Several factors are holding back fleet renewal. New vessel construction costs are double what they were 10 to 12 years ago. Additionally, financing is difficult and expensive, and shipyards capable of building these vessels have limited capacity. Rather than ordering newbuilds, owners have been buying secondhand vessels, upgrading existing vessels, or converting them for other uses.

Oil and gas operators have been forced to adjust. For years, 15 years was the standard maximum vessel age in charter tenders, an arbitrary “rule” that many oil and gas operators’ own logistics teams now recognize as impractical. Shipbroker Fearnleys warned that standard age limits would soon rule out about half the global fleet, which is unsustainable. Clients are becoming more flexible about vessel age, partly because older vessels help keep day-rate budgets down as rates for modern tonnage rise.

The shift comes with trade-offs. Older vessels require more maintenance, are generally less fuel-efficient, and produce higher emissions, which can conflict with charterers’ carbon-reduction targets. This is pushing charterers away from strict vessel age cutoffs and toward evaluating each vessel based on its condition, class and inspection records, and upgrades. Industry voices now emphasize that age matters less than how well a vessel has been maintained.

There has also been a growing preference for U.S.-built and U.S.-operated vessels, as they are generally better constructed and better maintained than foreign-built vessels of the same age. Until newbuilding picks up in a meaningful way, which looks unlikely in the near future given costs and lead times, more flexible age limits appear likely to remain a lasting feature of OSV chartering rather than a temporary fix.