From early February to late March, shipping costs for crude tankers departing the U.S. Gulf Coast rose sharply across all vessel classes and destinations as global trade flows adjusted to the disruption of Middle East supply. Rates increased most dramatically on the Asia route. Over that period, the cost of shipping crude from Houston to Asia (left graph) rose by roughly $13.50/bbl (about +130%) on Aframax vessels (roughly 600–750 Mbbl capacity) and by about $6–$7/bbl (+80%) on VLCCs (Very Large Crude Carriers, about 2 MMbbl capacity). On the Europe route (right graph), the increase was similarly pronounced, with VLCC costs rising by approximately $5/bbl (+100%) and Aframax rates increasing by about $10.50/bbl (+150%). The gains reflected rapid repositioning of ships, longer voyage distances, and strong demand for available tonnage as trade patterns shifted due to the Iran war.
Featured Articles
- Blog
The Purple People Eater – Tight Tanker Supply Sends Shipping Costs to Frightening Heights
Forget ghosts and monsters; this Halloween, the scariest thing in the energy industry is the tanker market, where a spooky jump in demand and frighteningly tight vessel supply have sent freight rates soaring to scream-inducing heights.
- Blog
Crazy – Attacks, Altered Crude Flows, Unbalanced Fleets Push Tanker Freight Rates to Record Levels
Freight rates are sky-high. Shipping crude oil from the U.S. Gulf Coast to China on a VLCC cost more than $80 million earlier this month, double what it was in September and 5X a year ago. Today, we look at the unique combination of factors that are helping drive freight rates to record highs.
- Analyst Insight
The $52 Million Voyage: Freight Squeezes the Export Arb
The tanker bill keeps climbing for U.S. crude headed to Asia. As discussed in this week’s Tradeview and Crude Voyager reports, the cost of chartering a Very Large Crude Carrier (VLCC) from the U.S.
