On reconciling macro and micro energy transport forecasts for strategic decision making in the tanker industry

Wessam Abouarghoub, Nikos Nomikos, Fotios Petropoulos

Research output: Contribution to journalArticle

Abstract

We propose the use of hierarchical structures for forecasting freight earnings. Hierarchical time series approaches are applied in the dry-bulk and tanker markets to identify the most suitable strategy for forecasting freight rates. We argue that decision making for shipping practitioners should be based on forecasts of freight earnings at different hierarchical levels. In other words, different strategic shipping decisions such as operations management, choice of freight charter contract and type of investment should be matched with the appropriate level of forecasts of freight earnings that are aggregated at different macro-levels: operating route, vessel size and type of trade.
LanguageEnglish
Pages225-238
Number of pages24
JournalTransportation Research Part E: Logistics and Transportation Review
Volume113
Early online date31 Oct 2017
DOIs
StatusPublished - 1 May 2018

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shipping
Macros
Decision making
Freight transportation
energy
decision making
industry
macro level
charter
time series
Industry
Time series
market
management
Energy
Freight
Strategic decision making
Shipping

Cite this

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abstract = "We propose the use of hierarchical structures for forecasting freight earnings. Hierarchical time series approaches are applied in the dry-bulk and tanker markets to identify the most suitable strategy for forecasting freight rates. We argue that decision making for shipping practitioners should be based on forecasts of freight earnings at different hierarchical levels. In other words, different strategic shipping decisions such as operations management, choice of freight charter contract and type of investment should be matched with the appropriate level of forecasts of freight earnings that are aggregated at different macro-levels: operating route, vessel size and type of trade.",
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