An increasing number of giant oil tankers are heading toward the Middle East to capitalize on soaring freight rates through the Strait of Hormuz, intensifying pressure on the global supply of available vessels and pushing shipping costs to record levels.
Although crude oil flows through the strait, which connects the Gulf region with global markets, have recovered in recent weeks to nearly pre-war levels, persistent security risks and attacks on vessels have kept shipping costs elevated. The cost of transporting oil from the Gulf to East Asia has climbed to more than six times its pre-conflict level.
More Than 40% of Global Super Tankers Near the Gulf
According to data from Signal Ocean, more than 40% of the global fleet of very large crude carriers (VLCCs), which comprises approximately 850 vessels, is currently inside the Gulf or within two days of sailing from the region.
The growing concentration is linked to ship-to-ship oil transfers conducted outside the Strait of Hormuz, as some tankers seek to avoid the risks of passing directly through the waterway. These operations are taking place in the Gulf of Oman, as well as at new transshipment locations, including areas off India’s western coast.
Georgios Sakellariou, a shipping analyst at Signal Ocean, said recent months had been the best ever for crude oil tankers. He noted that the reduced efficiency of ship-to-ship transfers was placing significant pressure on tanker availability both in the region and in other markets.
Oil Shipping Costs Climb to Record Levels
Signal Ocean data show that the number of empty very large crude carriers heading toward Atlantic ports has fallen by half compared with a month earlier. At the same time, smaller vessels are increasingly being used to compensate for the shortage of larger tankers.
These pressures are emerging as oil producers outside the Middle East, particularly in the Americas, maintain high production levels, increasing competition for available shipping capacity worldwide.
At least one tanker was offered this week for a voyage from the U.S. Gulf Coast to Japan at a freight rate of up to $82 million, equivalent to more than $40 per barrel. The rate represents an increase of more than 50% in just three weeks.
Tanker Charter Rates Surge 540%
The daily cost of chartering very large crude carriers on the Persian Gulf–East Asia route has reached approximately $1.4 million, an all-time high and an increase of nearly 540% compared with pre-war levels.
By comparison, Brent crude prices have risen by around 40% over the same period, highlighting the extent of the pressure on maritime transportation costs relative to the increase in crude oil prices.
Shipping Crisis Spreads Across Global Oil Markets
Rising charter costs for very large crude carriers have encouraged greater use of Suezmax and Aframax tankers on other routes, including shipments of U.S. crude oil to Asia scheduled for November.
Shipbroker Fearnleys has indicated that charter rates for these vessels show no signs of declining, reinforcing concerns that elevated maritime transportation costs could persist and gradually affect oil markets around the world.
The continuing disruption around the Strait of Hormuz is therefore placing pressure not only on regional shipping operations but also on the availability and cost of tankers serving international oil trade.
