Chairman of the Board, d'Amico International Shipping
Paolo d'Amico of d'Amico International Shipping & INTERTANKO on Riding The Waves Of A Lifetime
Mr. Paolo d'Amico, Chairman of INTERTANKO, and Executive Chairman and CEO of d'Amico International Shipping, shares his ...
Transcript (38 segments)
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Nicholas Borol0:13
I am Nicholas Borol of Capital Link and I would like to welcome you to today's podcast. The podcast series 'Riding the Waves of a Lifetime' gives us the opportunity to discuss with maritime industry leaders who share with us career and life experiences as well as their insight on the industry's direction, opportunities, and challenges. I would like to thank the Cambiaso Risso Group, a major global insurance broker and shipping agency, for sponsoring today's podcast. Today we have the opportunity to discuss with Mr. Paolo D'Amico, one of the most influential and outspoken industry leaders. D'Amico is among the Lloyd's list of 100 most influential people in shipping. Paolo is a major shipowner and a maritime industry statesman. He has a highly successful career as a global shipowner as he is at the head of a major shipping group active in the dry cargo and the product tanker sectors as well as in ship management. As an industry statesman, he is the chairman of Intertanko, the Independent Tanker Owners Association, and he is also active in several other organizations in the industry. As such, he has a broader institutional footprint and involvement with the maritime industry and especially with the tanker sector, helping it address its challenges and shape its direction. The D'Amico Group is one of the oldest and most successful Italian shipowners with a global presence today in more than ten maritime and financial centers worldwide. The group was founded in 1952 but its origins date back to the 1930s. In 1971 Paolo joined the family company with particular focus on the product tanker aspects of the business. Today he is the executive chairman of the holding company D'Amico, with his cousin Cesare D'Amico being the chief executive officer. He is also the chairman and chief executive officer of D'Amico International Shipping, the product tanker arm of the group which has been listed on the Milan Stock Exchange since 2017. He is currently serving his second two-year term as chairman of Intertanko. He was first elected in November 2018, succeeding at that time Dr. Nicholas Chakos, the Chief Executive Officer of TEN. As I mentioned, he is also active in several other industry organizations including the Registro Italiano Navale where he serves as chairman since 2020 and until 2023, and the Italian Shipowners Confederation where he served as president for three years between 2010 and 2012. He has received several awards and distinctions for his industry leadership and in 2013 he was awarded the honorary title of Labor Knight by the President of the Italian Republic. I would like also to thank him for the excellent cooperation we have developed over the years. It has been a real privilege to interact with him and the D'Amico Group. Our discussion is going to include a brief trip down memory lane, then focus on today, and then we will look ahead. We will focus on three themes: sharing a few career and life experiences, then looking at topics that affect the broader shipping industry, and then topics that relate to the tanker industry. We will have the opportunity to discuss with him for about an hour. Our discussion is meant to be an in-depth, insightful, authoritative discussion, not a quick run-of-the-mill touch upon topics. So we look forward to our discussion and to his insights. And now I will kindly ask Paolo D'Amico to join us to begin our discussion. Hello.
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Paolo D'Amico4:34
Nicholas, so thank you for joining us.
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Nicholas Borol4:36
Paolo, and I always as I said I admire your office, it's a wonderful background that you have. So you come from a major shipping family and the question of how you got into shipping is kind of self-explanatory, but still, as I mentioned, the origins of the group go back to the 30s. So can you share with us how it all started, how it developed for yourself and for the group, and please share with us some highlights of the family's history and involvement with shipping?
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Paolo D'Amico5:13
Now, let's start from the family first. It all started from my grandfather in the 30s because he was a lumber trader. Lumber in those days was very important and he was moving a huge amount of lumber, importing it into Italy. My father, who was not yet 21 or 22, and his brother joined my grandfather, and they saw there was a lot of chartering activity. My grandfather was chartering a lot of ships to move the lumber around. At that point, the two kids — I have to say it came from them — we started saying, 'Why don't we start owning our vessels instead of chartering them from third parties?' One thing that I always admire of my grandfather, even though I unfortunately didn't know him, is the fact that he said — today if your son of 20 comes with an idea you probably say okay I'll think about it later or you probably send him somewhere else, but in those days my grandfather said no, fine, let's try, let's do it. I think that was a great move because everything started from there. We owned at the beginning of the war six vessels, and unfortunately we lost all of them during the war, and then things restarted like everybody else with the Liberty ships and the Marshall Plan and so on. My father at a certain point moved on his own company. There were seven brothers, and he moved with two brothers away from the rest of the company and went on his own, and the whole thing started there for my side of his adventure. I ended up in it. I remember the first time I went on a tanker was in Rotterdam and I was seven years old. Since then, I always went on ships. My father wanted me when I finished my homework after school to come to the office. So for me to come to the office was a normal thing. I was meeting all the managers and I had a beautiful relationship with them. So the office at the end of the day was my second home, in some ways probably it was even the first one. So when I finished school, my father just said, 'What do you want to do?' and I said, 'I follow you.' So he said, 'Welcome on board then.' And everything started from there. So I think my story is very similar to many other sons of shipowners I suppose, because there is such a merger between the father figure and the boss, and that is what is unique. So you really have this mix of the family and the business activity. So for me it was natural, and I'm very happy I did it. I never had a doubt.
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Nicholas Borol9:31
We have the opportunity to discuss with a number of second- and third-generation shipowners, and it is always really wonderful to see how in cases like yours you have the continuity, the tradition, the history, and all of that transcends into the continuous development of the company. So thank you for sharing this with us. Now let's discuss for a moment the profile and the operations of the D'Amico Group. You are one of the largest and most successful shipowners, Italian but with a leading presence in this global industry. You are active in several shipping segments and as I mentioned you have a global network around the world in major industry and financial hubs. So can you describe the group to us?
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Paolo D'Amico10:24
We operate a fleet of 100 ships today. 38 are product carriers, we have a couple of container ships, and the rest are bulk carriers going from Supramax all the way up to Mini Capes. We have also a portion of the fleet which is chartered in on long term, and some of them on the dry side are operated on short term. We operate commercially out of New York, London, Monaco, and Singapore, commercially and operationally because we keep operation and chartering together. Technically we run our fleet out of Rome or Singapore, where we own a third-party ship management company. We man our ships out of India and out of the Philippines for the dry cargo, Indians more for the tanker side. We still have some Italian officers but unfortunately, as it happens in Europe, less and less Italians want to board a tanker today. We are pushing a lot for it because I think we have a big debit to our crew, and Italians have been the startup of everything in the past. If we are where we are in terms of quality and of success in ship management, it is for them. So for us it is important to keep a number of Italian seafarers, even if it is more and more complicated. On the rest, of course we run different things like real estate and financial investments, but those are outside the company perimeter. I personally live in Rome. I lived all my life excluding a few years in London and New York, but I lived all my life in Rome. I'm very happy to be here. You see today you don't have anymore, as was in the past, the need to be on the market. Communications today are such, and I have to say after COVID even more, that we probably have to travel even less than we used to. So I live in Rome and we operate from here. I'm running a company with my cousin Cesare, who is my partner, and he has exactly the same carbon copy story of my life. Wonderful.
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Nicholas Borol13:49
So you shared with us how you started. Can you possibly discuss a little bit a few major milestones in your career and possibly a couple of major challenges that you had to deal with? And also I'm particularly interested to see what it means and how it is to work for such a major family-owned group which also includes a publicly listed arm that you're heading.
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Paolo D'Amico14:20
Certainly the most important moment of my life, like I suppose for everybody, has been when I lost my father. Because here again, I didn't lose only my father but I lost my boss, I lost everything, I lost my guarantees of life, let's put it this way. Life for me before was quite easy, afterwards it became a little bit more complicated. So certainly I felt okay, now holidays are over, because to the sadness of the loss you had also the fact that you have to take first line of responsibilities in the company. I was 26, so I had to move on. Thanks God I did work with my father for a few years, so I learned a lot of things from him. I would say I learned everything from him and I kept going. The second moment maybe of significance has been when I went to an American bank with my cousin. We ordered five newbuildings and we didn't have the money, so we went to the bank. It was a major American bank. I went through credit committees and things. To cut the story short, I remember this executive vice president who was lending the money said, 'Now Paolo, now you have the money, don't mess it up.' So I had a line of credit of 105 million dollars, and I have to say I had to repay it in seven years, I did it in five. That was another moment of my life where I said hey, I mean you are doing something, and so you are not anymore the son of, you are the real thing. Those two moments have certainly been the most important for me. Afterwards of course I borrowed a lot more, but it became very easy to do it. It is always the first time that is the most complicated one.
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Nicholas Borol17:11
Absolutely. Well, thank you for these wonderful personal moments, very important ones. So now let me focus on D'Amico International Shipping, of which you are the chairman and CEO. The company was listed on the Milan Stock Exchange in 2007 and today it controls a fleet of 38 product tankers, 27 of which are MRs. So can you share with us a few major milestones in terms of the company's development? And also I wanted to ask you why did you choose the product tanker sector as opposed to crude tankers or another segment?
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Paolo D'Amico17:55
When in the 70s I joined the company, we were operating the normal mix of things: crude oil, we had VLCCs, we had Aframaxes, and we started having product carriers. We owned three of them. I remember discussing with my father. He was saying, 'Look, we are building refineries in Saudi Arabia, and it is a big one. You will see, I don't know when but it will happen, but we are going to move more products and less crude somewhere because these refineries are built in a different place where consumption is, in a more distant place, so the ton mile is going to increase.' In those days the ton mile didn't exist, we were just saying we will need these ships because the clean cargoes are going to increase terribly. As a matter of fact he was right, because today the clean cargoes are something like between 35 to 40% of the oil moved on sea. So he took a big share. When at the beginning of the 80s with my cousin we discussed what we wanted to do in the future, I said, 'Look, I think the best thing for us is to concentrate on one type of industry more than going around everywhere.' So we focused a lot on product carriers. We started in the early 70s with 20,000 tonners, then we moved on to the 30s, and now as you said we are on the MR and LR ones. We just kept going but we built up our name in this segment. The charterers started knowing us and they liked the management, and we put our name on this. We didn't think anymore about crude oil tankers, not because they were good or bad but just because it was a different story. When in 2007 we started thinking of the flotation, we actually started with the idea of listing the whole company, but it was our financial advisor who said, 'No, it's better you limit it to the tanker side because the tanker story is something that people like, probably even more than the dry cargo.' So this happened and we listed only a part of it. We did it in Milan because with an Italian name it was easier for us, and also for investors it was easy to know us. It has been an advantage because the Milan market is quite liquid. I keep having people ask me why you don't go to New York or to Oslo. I don't go to New York first of all because I don't have the dimension to go to New York, but I don't go to Oslo because I am very happy where I am. We had a fantastic result and a fantastic relationship with our Italian investors. So we listed the company and there started a new life, because of course one thing is when you are private, another thing when you are listed. You start following your learning curve, understanding that you have to communicate, you have to talk, you have to meet the people because it is a completely different story. But I like it, I have to say it has been a great experience. I like the quality of investors that I have met up to now, so it has been a great experience. I would do it again.
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Nicholas Borol23:14
Wonderful to hear. And by the way I want to say we have been privileged to work with D'Amico International Shipping for a number of years, so I can attest to what you just mentioned. But let me ask one last question regarding the group. At D'Amico, on the tanker side but also on the bulker side, you have focused on a strategy of fleet expansion not only through owned vessels but also through long-term chartered-in vessels with purchase options, and when these are in the money you can buy them. That has been a major growth opportunity for you. Also another very interesting aspect is that you have focused on Japanese-built vessels mainly. So can you share with us the advantages of this well-specified and focused strategy?
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Paolo D'Amico24:08
I would say first of all it all started from my cousin on the dry cargo side. We had to build the dry cargo fleet because the dry cargo ships were by far less than the tankers, and in tankers we were already not only a fleet but also a name. So my cousin Cesare started this whole activity going to Japan and putting our name around. In Japan, Japanese are great people but to conquer their trust you need time and you must be patient. He did a fantastic job in this. I am extremely happy to have him as a partner. At a certain point we already built up a fleet of bulk carriers and we started thinking why not do the same on product carriers. Our approach on tankers was always to build a ship and give it on time charter to a major oil company, but then we started being a little bit more active on the spot activity and then we thought, let's start with a couple of Japanese product carriers and then we'll go on. And so it happened. A purchase option is a normal thing you ask for, and of course at the end of the day we are traders, if we are in the money we do it. I think it was not really a strategy which was designed on the desk, it was a normal evolution of what we were doing starting from dry cargo and then moving on to tankers.
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Nicholas Borol26:42
Great. So let me now, we have about an hour in our discussion, let me turn now to the industry section. I have a number of important questions to ask you. You are, as I mentioned, now serving your second term as the chairman of Intertanko, and you have been very vocal on several critical issues trying to drive change and development in the right direction. So at Intertanko and also at your group, you have been dealing with issues such as decarbonization, digitalization, ship safety and security. So let's try to devote a little bit of time to each one of them, starting with decarbonization. The standard approach that I have is when you talk about decarbonization you have three major topics: who regulates the process, which are the fuels of the future, and how to pay for it. So let's start with number one, who regulates. Now you have been an ardent proponent that the IMO should be the global regulator. However, as we have seen at this point we have a number of regional or national regulations potentially coming into play. So is there still a way to achieve uniformity and pursue a global solution?
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Paolo D'Amico28:03
I think yes, but unfortunately you see already too many people are in the arena and they are taking actions. Unfortunately, IMO, we need one body. We are a global industry, so we cannot globally operate and have too many people because we will get lost. But unfortunately this is what is going to happen because you saw that the EU already moved in, and probably the US will move in this way. This will bring inefficiency and this will bring also higher cost to the final consumer. I am someone who has his limits, probably he has to be reformed, I don't know, but one thing always touches me a little bit: we talk about IMO like it is a body coming from the planet Pluto. IMO is us, IMO is made by our countries. So if we don't like the way it works, we change it, we discuss it, we reform it, but you don't scrap it on one side and try to do something different on the other side because you are confusing the system. Shipping is not a known industry but now it is becoming known. If you look at the container ships, you cannot move a container around today so you understand how much shipping is important, and so it is on oil and so it is on dry cargo. We need to be ruled by as severe as you want, it's not a matter of easy life, but let's try to talk to one establishment. But as I said, unfortunately this already is not happening because also some colleagues of mine are pushing a lot for a regional system instead of a global one. I think it is a mistake.
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Nicholas Borol30:38
I know most of the industry people that I speak with, as you mentioned, everybody wants the IMO to be the global sole regulator, but at the same time how do you achieve a solution whereby you may have the European Union, China tomorrow, the US national, entities that come up and they want — how can you enforce a global solution? It sounds very difficult.
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Paolo D'Amico31:04
I think it is going to be more difficult if we have to follow all the regional ones as you rightly said. China will come up with something or the Asian countries, certainly America will come with something, and we have to follow everybody. Let's hope at least that there is a level of uniformity in what they are going to do, because we cannot build a ship which can comply with whoever — it becomes impossible.
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Nicholas Borol31:41
Well, you know, at the end of the day if you end up having a lot of regional or national regulations, that will take away from the effectiveness of the IMO and will make things a lot more complicated and costly as you mentioned. But anyway, let's go now to topic number two, the fuels of the future. We see an increasing number of companies using LNG as a combustion fuel, at the same time there are so many other options in development out there. The D'Amico Group, I know you have been testing biofuels. So how do you see this process of the fuels of the future evolving and can there be a final outcome?
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Paolo D'Amico32:18
I think we are going to have two phases: a medium-term phase where you are going to have a mix of fuels — owners using LNG, owners using biofuels, owners using methanol and so on. We moved on biofuels because it was the closest thing for our existing engines without thinking about retrofitting or doing any sort of modification, and the results are extremely positive. Of course they are not at emission zero because you cannot be at emission zero today, but they are certainly saving a lot of CO2. Going ahead, now you have all these efficiency indexes coming in in 2023, CII and so on, coming into force. We will see what is going to happen. Certainly we are going to define and see the real efficiency of the ships and the fleet. What I am worried about, and I've been thinking about it a lot, due to this uncertainty that we have today very few owners are prepared to order newbuildings, and the existing fleet, even if it was delivered a few years ago, is just getting older, certainly not getting younger. So at a certain point, if we don't replace our vessels we are going to have an old fleet, and without knowing very well where to go because after 2030, in ten years from now, we will start getting closer to the 2050 target. What is going to be the fuel there? That is a big question mark. We have a lot of speculation: ammonia, hydrogen and such, but we know that hydrogen is not good as a fuel for ships because of the cubic capacity, because you have to freeze it to over 200 degrees Celsius minus. Ammonia is toxic but could be the solution. Toxic is not a problem, it can be solved. But are these theories? How all this is going to happen? I am waiting for the final user of our services to come up and say, 'Okay guys, now we have a problem here because we have to move energy somewhere and somehow, so how we want to do it?' And probably we will start some sort of project finance with long-term charters, because it's the only way for the shipowners to change skin. Here we have to change skin, and to finance this huge investment that is going to happen in ten years. It is going to happen, and certainly you cannot think that okay, I am on speculation, I'm going to build an ammonia-fueled ship. No way I'm doing that if I'm not sure that my ship is used by somebody and is guaranteed. Also because I think these ships, whatever they are going to be fueled by, are going to be more expensive. So the capital intensity of our industry is going to grow terribly. Decarbonization is a beautiful name but it is going to cost us a fortune.
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Nicholas Borol37:14
And that brings you to the next question: how do you fund or pay for it? Again, we have seen a multitude of ideas and options on the table. Is there one more practical or realistic method to achieve funding or paying for it?
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Paolo D'Amico37:32
I think the funding will be the usual one as long as there is a time charter on the other side. So it will be more a sort of project finance. Of course the big guys — I remember LNG when I was younger, an LNG ship was always fixed with a 20-year time charter and was always a project which was covered by a long-term contract. Then somebody with a deep pocket started building them on speculation. Probably also on this round that will happen, but a very limited number of candidates can do it. So I would say the majority of the owners will probably be looking for end users with time charters and financing normally, or a lot of them will become just ship managers and run it for investment funds or good knows what.
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Nicholas Borol38:42
Let me move on to the next question. You are the head of a major industry organization, so I wanted to ask you: do you think that the shipping industry has an effective and unified way to make its voice heard on decarbonization, new fuels, or other industry issues? You have the council with Intercargo, Intertanko, BIMCO, ICS interacting with IMO and other regulators. Also we see a number of initiatives by new organizations. But at the same time, does this lead to more fragmentation of effort instead of concentration of focus? So how do you see the shipping industry reinforcing its voice, visibility, and impact?
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Paolo D'Amico39:35
It's up to us shipowners. Unfortunately you are right, there is fragmentation going on. Before it was only the voice of shipowners, today it starts being the voice of shipowners, banks, traders, and so on. Everybody is coming up with a statement. I think that we don't need statements here, we need a common ground which makes sense, which is economically feasible, transparent, and simple. We need simple things, we don't need complicated ones. Here again, we will obey to the most severe rules needed, but there is no need to be — we see everything flying today, to be frank. For my taste it is a little bit too much and we are confusing everybody.
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Nicholas Borol40:40
I agree with you. So let's now focus on technology and digitalization. I know that the D'Amico Group has made significant investments in this area. Can you share with us what areas you see as the most affected by digitalization and where we can expect to see more progress looking ahead?
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Paolo D'Amico41:01
Certainly in the old days, a ship was run by the crew. The ship used to send a cable once every three days giving position, speed, consumption, and some basic data, and that was it. It was sort of disappearing from the radar because communications were not easy, only through radio and we had radio officers. After that, the satellite arrived and I remember that very well, I was impressed by the satellite system. Already with the satellite you could pick up the phone and call the ship. That was a huge move forward in the communication system. Not only that, it was the borderline where the ship was not anymore alone at sea but was becoming something that you were talking and dealing with daily. With digitalization, what is happening is we are moving away from paperwork. Everything — the various logbooks that we used to have on paper in the past, and we still have them today, even those that we have to have by law and by rules — are not going to be on paper anymore, they will be digitalized. Not only that, the data will come on real-time online to the shore offices. This means that we can act, and this is our program, we can act on the management of the logbooks from shore. We connect with a number of sensors already for maintenance on our equipment. We are going to leave the technical and bureaucratic life of a ship minute by minute. It is not anymore that the superintendent goes on board and looks at the papers. Certainly this will facilitate a lot of things but aggravate others, unfortunately life is always like that. You solve a problem and you get another two coming up. The shore staff is going to be more and more responsible, and maybe if you are not careful, the crew, the officers, risk losing a little bit of traction on responsibility because anyhow there is a guy in the home office doing the job. So we have to be careful the way we use it. Certainly this is going to improve terribly the quality of ship management and as a consequence, the safety and security of our operations.
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Nicholas Borol44:55
Well you led me to the next question. At Intertanko and also D'Amico, you have made a big push to increase ship safety and security, including crew wellbeing, piracy, cybersecurity, a number of important topics. So what are the latest initiatives undertaken in these areas?
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Paolo D'Amico45:26
Certainly we have been extremely focused over the last 18 months on the COVID case, the crew change. I keep saying that seafarers have been the heroes of this period because they faced it. I know there have been some problems. We as a company, thanks God, we didn't face too many problems because our managers have been very active communicating with them on board, telling them the truth of what was going on and saying, 'If I can, I will substitute you at this port or that port, but nothing is guaranteed because we don't know what can happen.' They did miracles in changing crews. Somebody has been staying on board for quite a while, and I have to say they didn't complain, they did their job. The thing was a test of capability of our seafarers, and we did it over the last year and a half. The results are great, so I'm very happy about that. As far as safety in general, piracy: we have been facing before the Somali problem, but Somalia was in some ways easier because once we put armed guards on board, the whole thing basically disappeared. It was not easy to have armed guards on board because even from a legal point of view it was not so clear in the old days. Now the problem is in West Africa, even if it is slowly improving. But you know, Somalia, we all respect, but there was not a country. In West Africa we have sovereign countries, and they do not accept us coming with cowboys with rifles shooting at people. As Intertanko, we helped them to come up with a solution, and we try to avoid criticizing because there have been a lot of critics on the countries, but you have also to understand the problems of the people on the other side. I think we in Intertanko did that, and it has been very much appreciated because to criticize is absolutely useless. I think today Nigeria, you are going to see some results. I hope it will improve, I'm sure it will improve because they really want to do it. So this is basically where we are now. There is a start again of piracy around the Singapore area and Indonesia. It is very easy to board a ship and hijack it and ask for a ransom. Unfortunately there are still a lot of poor people around and the temptation is very strong. There have been improvements and let's hope this will continue.
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Nicholas Borol49:40
Well, there have been improvements and let's hope that this will continue. Now let me move on to the next topic: ESG. It has become a core topic across all industry stakeholders, and your company specifically has made a big commitment to this. Actually you recently announced that executive compensation would also be tied to ESG criteria. So can you please elaborate on this?
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Paolo D'Amico50:06
We think that ESG is going to be one of the main drivers in the future for shipping companies in the sense that banks, charterers, they are going to look first at them and then probably look at the rest of the company, how you operate and all that. So the thing of linking the compensation also to ESG is to create that sense of responsibility in the management, top and also medium management, in respect of these three letters. Of course it means environmental, safety, and governance, but they are not only three letters, it is a matter of philosophy, a way of life. I have to say when we started facing this problem, my first reaction was, 'Yes fine, but we are already doing all this, there is nothing new.' In fact, I would say it is so, but today we have to codify more what was the normal behavior of the past. I can tell you in my calls that I have with analysts and investor analysts, we are starting to get a lot of questions about what we are doing and what we are not doing. So yes, we intend even to put a member of the family as responsible for this thing because we want to say that we put our face on it. It's not something that we are playing games with.
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Nicholas Borol52:11
Wonderful. So we are approaching about an hour in our discussion, so let me move quickly to a couple of concluding questions. Let me go into the tanker industry. Can I have your insight in terms of the drivers that will lead to a stronger market for tankers, especially for product tankers? Is it demand driven, supply driven, or both?
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Paolo D'Amico52:33
I would say both in a sense that now supply is very low, so we cannot say that we are really over supplying the system. It is the demand which is lacking, mostly I would say jet fuel. The fact that we are not flying anymore because we are driving more or less as much as we did before the pandemic. So the tracking and all the rest of the system — mostly of the oil goes into transportation fuels. That is where we are making our living. Unfortunately, flying is still a good third under the levels of what it used to be. You know, we don't need that much to see the market moving upwards because you are always on the margin. There is always a marginal percentage that is lacking, but unfortunately it is still there and it is very much related to COVID, very much related to how people will live, will move. Certainly what I am seeing today on these cases that are starting again in the UK and in Holland are quite worrying. But anyhow, it is there and I think the problem is that the faster we go back to normal life, the faster you will see the market back again.
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Nicholas Borol54:17
Let me ask you: we all discuss about decarbonization, the greener economy, renewables and so on. In this broad context looking ahead, do you expect demand for oil and also for products to decrease, and would that have an impact on the tanker segment?
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Paolo D'Amico54:38
It is something to take into consideration because we cannot say — you saw SIXT bought 100,000 electric cars from Tesla yesterday. These things are happening and we can say these are not going to have consequences on our market, but certainly it is going to be a longer process. It's not that oil is going to disappear tomorrow. Not only today we have a problem with coal, we have a problem also with gas, and we see how oil is imported. How are we going to face this winter? If it is going to be a very cold winter, it is going to be a hell of a problem. If we don't stop this thing of 'I want to be out of oil as fast as I can' when I do not have the alternative, I end up in an energy crisis. We are building an energy crisis if we are not careful enough.
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Nicholas Borol55:49
Thank you. As you very correctly pointed out, all these things, the trend is there but it will take a long time before we really see the needle move. So let me ask a concluding question, actually two concluding questions. One is: how do you see shipping and the world developing in the post-COVID era?
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Paolo D'Amico56:16
We will be moving, we will be operating our ships, moving maybe different commodities. In the extremely long term, we are not going to move oil, we are not probably going to move coal, but we certainly are still going to move soya and agricultural products, and we are probably going to move ammonia or God knows what. There is no way that shipping will disappear. So it is up to the shipowner to upgrade himself to what the market is going to be in that moment. The fuels are going to be different. I think we are going to have a mix of fuels, I don't think we will have one universal fuel for everything. Container ships have their problem, dry cargo have their problem, tankers have their problem. It is not going to be as it is still today with fuel oil. I don't think LNG is going to be a long-term thing, it is going to be there for a while but it is not going to make too much difference.
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Nicholas Borol57:45
So concluding question: you are running a global shipping organization, at the same time you are the head of a major industry organization, so I can imagine that the demands on your time must be enormous. I'm grateful that you actually took an hour out of your extremely busy schedule for this podcast. So let me ask you: how do you balance business, seafaring, life, family time? How do you balance it all? It must not be that easy.
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Paolo D'Amico58:17
You get used to it at a certain point. You need a very patient wife of course, but she knows me, we have been together close to 40 years, so she saw me growing in my career. It is not something that happened all at once. It is a matter of having a very good staff with you which organizes your life. It is possible to do it. There are people by far more busy than me and they are around and they are enjoying life too. Actually they say if you want something done, give it to a busy man.
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Nicholas Borol59:08
There we go. So Paolo, thank you very much for a tremendously insightful discussion. Again, as I mentioned, you combine both being a major global industry participant but also being an industry statesman. So your insight is extremely valuable, and I thank you very much for being with us and also for all the cooperation we have had over the years. Thank you.
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Paolo D'Amico59:35
Thank you.