Price Tag For Oil Tanker Shipments Soars To Record High As War Grips Middle East

The cost of moving oil around the world is exploding as the Iran war forces tankers onto longer routes and strains the ships still willing to operate near some of the world’s most important energy chokepoints.

Earnings for supertankers traveling from the Middle East to China reached a record $759,969 per day in September, while the cost of shipping crude from the U.S. Gulf Coast to China hit a record $29.5 million per voyage on Sept. 4, according to S&P Global.

“The wars in Ukraine and Iran remain the big elephants in this particular living room, and prices aren’t likely to go much lower until those elephants are killed,” energy public policy analyst David Blackmon told the Daily Caller News Foundation.

Brent crude climbed above $100 per barrel this week as continued disruptions around the Persian Gulf tightened global supplies, according to Reuters.

The benchmark crossed $100 Wednesday — for the first time since July — after American forces destroyed five Iranian tankers. American forces destroyed five Iranian crude oil tankers Tuesday after Iran targeted a U.S. Navy warship, according to U.S. Central Command (CENTCOM). CENTCOM also destroyed three Iranian crude carriers on Sept. 5.

The turmoil is also hitting American drivers. The national average price for regular gasoline reached $4.22 per gallon Wednesday, up from $2.98 two days before the war began on Feb. 28, while diesel reached a record $5.94 per gallon, according to American Automobile Association (AAA) data.

Shipping costs have also surged. The Baltic Exchange tracks tanker rates across major global routes, including shipments from the Middle East Gulf and U.S. Gulf to China. Its latest tanker report showed the U.S. Gulf-to-China rate jumping by more than $3.6 million in one week to nearly $28 million, while estimated daily earnings on the Gulf of Oman-to-China route topped $261,000.

Traffic through the Strait of Hormuz fell to its lowest level since May in early September following attacks involving American and Iranian forces, according to Reuters. Kpler data showed an average of just 10 commodity vessels per day crossed the strait over a 10-day period. Just six commodity vessels crossed the Strait of Hormuz on Tuesday, according to preliminary Kpler data.

“Tanker traffic through the Strait of Hormuz slowed once more after U.S. and Iranian strikes on vessels over the weekend,” Stuart Turley, president and CEO of the Sandstone Group and host of the Energy News Beat podcast, told the DCNF. “Kpler data showed a 10-day moving average of just 10 commodity ships per day, the lowest since May. Pre-war daily transits ran 125–140.”