Week 15 of 2026 signals a potential shift in the global ship recycling markets, as the war-driven oil premium begins to ease for the first time in months. While conditions are improving, the supply of end-of-life vessels remains constrained, continuing to limit transaction volumes across key recycling destinations.

The broader macroeconomic environment showed notable movement this week. Brent crude oil dropped sharply from above USD 109 per barrel to near USD 101 following geopolitical developments in the Middle East, marking an important correction in energy markets. However, freight markets remained firm, with the Baltic Dry Index rising above 2,100, continuing to support vessel earnings and delaying recycling decisions. Currency markets were relatively stable, with a slightly softer U.S. Dollar offering marginal support to sub-continent buyers.

Bangladesh remains the most competitive and active recycling destination. Chattogram recyclers benefited from a sharp increase in local steel plate prices to BDT 71,000 per ton, significantly improving bidding capacity. At the same time, the easing of Letter of Credit bottlenecks has supported transaction momentum. However, compliance concerns persist following unresolved sanctioned vessels, reinforcing stricter due diligence across the market. With the monsoon season approaching, Bangladesh faces increasing pressure to secure tonnage within a narrowing operational window.

India experienced a partial reversal of last week’s currency gains, with the Rupee softening to around 93 against the U.S. Dollar. While steel plate prices saw temporary improvements during the week, ongoing LPG supply disruptions continue to impact steel production and overall yard economics. Despite maintaining over 110 HKC-compliant yards, India remains constrained by limited vessel inflow, leaving its structural advantages underutilized.

Pakistan continues to demonstrate stability, with the Pakistani Rupee holding steady and steel plate prices remaining firm at PKR 177,000 per ton. This stability has reinforced Gadani’s position as the second most competitive recycling destination. The country’s growing HKC-compliant capacity and proximity to Gulf tonnage continue to support its market position, although a potential easing of regional tensions may impact this advantage going forward.

Turkey showed modest improvement this week, with the Lira stabilizing slightly and inflation easing. However, at price levels around USD 268–288 per LDT, the market remains uncompetitive compared to the sub-continent. Turkey continues to operate primarily within the niche segment of EU-approved recycling facilities, where regulatory compliance outweighs pricing considerations.

A notable transaction this week included an LNG vessel reported at approximately USD 513 per LDT, highlighting that while activity remains limited, deals are still occurring under the right conditions.

The key theme remains unchanged: recyclers are ready to acquire tonnage, but vessel supply continues to lag. As oil prices soften and geopolitical uncertainty evolves, the market may be approaching an inflection point. However, whether this leads to a meaningful release of the backlog of vessels remains to be seen.