⛴ Oil tankers stampede to Hormuz as risk sends rates sky-high

Supertankers are flooding the Persian Gulf to capture soaring premiums for oil shipments through the Strait of Hormuz, tightening vessel supply worldwide and pushing freight rates to extremes, reports Bloomberg.

Crude flows through the strait have rebounded toward pre-conflict levels despite Iran still keeping the waterway closed, leaving vessels at risk of attack. The risks have sent tanker costs soaring.

♦️ cost of hiring a very large crude carrier (VLCC) for the roughly three-week Gulf-to-East Asia voyage has hit a record nearly $1.4 million a day

♦️ a VLCC was offered $82 million to sail from the US Gulf to Japan - over 50% higher than just three weeks ago

♦️ more than 40% of the world’s 850 VLCCs are now in or near the Persian Gulf (Signal Ocean)

♦️ empty VLCCs heading to Atlantic ports have halved in the past month

Oil is increasingly being transferred between tankers in the Gulf of Oman or off India’s west coast to reach vessels willing to take the risk of sailing through Hormuz.

The ship scarcity has forced a shift to smaller Suezmax and Aframax vessels on non-Middle Eastern routes. Most November US-to-Asia deals now use these ships, lifting their rates in turn, noted shipbroker Fearnleys.

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