Shares of Nordic American Tankers (NAT 2.97%) jumped as much as 14.1% on Wednesday on speculation that tanker demand will increase this year. Shares of the oil tanker stock closed the day up 12.9%.
Tanker stocks had a strong day after Germany said it could be close to being able to cease Russian oil imports very soon. If Germany isn't importing oil from Russian pipelines, it makes sense that it would need to import more oil from overseas via tankers.
The spot price of tankers has been rising since Russia began its invasion of Ukraine, and this could be an indication that the impact on oil markets could be long-lasting. If Germany is making long-term deals to buy oil, it could need more tankers for many months, if not years.
The tanker market is certainly seeing some tailwinds right now from the world reducing its reliance on Russian oil. But it's not clear if that increase in demand will be short-lived or if prices will come back down later this year.
Over time, the tanker market tends to oscillate between oversupply and undersupply. Right now, it's undersupplied, and stocks are up as a result. But over time that dynamic will likely reverse, which is what's keeping me out of tanker stocks today.