DVB Research and the Erika Effect

By Urs M. Dür

David Berge of DVB Nedship recently published a research report, “The Shipping Landscape: Crude Oil Tankers”. It is a good example of why we think commercial banks bring a lot more to the table than just loans. DVB’s commitment to delivering an economist’s perspective on market analysis was successful. Few investment banks take the time to, for example, explain the coefficient of determination for tanker rates vis a vis import demand.

The only point to which we take exception appears is the following statement, which appears on page 29 of the DVB research report: “The tanker market recovery of 2000 is a classic example of an effective UPDE [unexpected positive demand event], driven by demand events, but enabled by the supply situation. The ‘Erika Effect’ is a misnomer.”

This is only an excerpt of DVB Research and the Erika Effect

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