11:13 AM EDT, 07/23/2024 (MT Newswires) -- Kirby's (KEX) product tanker rates "held at solid levels" in Q2, while crude tanker rates face a "typical 3Q seasonal swoon," BofA Securities said Tuesday in a report.

Total vessel demand is expected to increase 6.4% from a year earlier due to longer hauls triggered by geopolitical events and a rise in product demand, the report said.

Scrapping will reduce crude vessel supply in 2024, leading to robust pricing across the product, crude and inland tanker barge sectors, the report said.

Newbuild prices are rising and growth of product tanker orderbooks poses long-term pricing risks, while new barge orders are constrained due to increasing costs and higher borrowing rates.

BofA increased the price objective on Kirby's stock to $141 from $138 and reiterated its buy rating.

The firm lowered its price objective on Scorpio Tankers ( SBBA ) to $82 from $85 and reaffirmed its neutral rating. BofA reiterated its buy rating on the shares of Teekay Tankers ( TNK ) and maintained the price objective at $79.

Kirby shares rose 0.7% in recent trading Tuesday, Teekay gained 0.1% and Scorpio Tankers ( SBBA ) fell 0.6%.

Price: 125.95, Change: +0.83, Percent Change: +0.67