The cost of shipping US oil to Asia has reached a record level!
The charter rate for a VLCC tanker carrying 2 million barrels of crude oil from the US Gulf Coast to China rose to $44.8 million on Tuesday.
The deepening supply disruptions in the Middle East have sharply increased the cost of shipping US crude oil to Asia. According to the Baltic Exchange, the charter rate for a VLCC tanker carrying 2 million barrels of crude oil from the US Gulf Coast to China rose to $44.8 million on Tuesday. This is significantly higher than the $39 million recorded a day earlier and marks an all-time high.
Before the conflict began, the cost of the same shipment was around $17.8 million. Despite this, US crude remains attractive to Asian buyers, mainly because it is cheaper than alternative cargoes such as Murban crude from the United Arab Emirates.
Higher tanker rates are also being driven by a decline in the number of vessels willing to pass through risky routes, including the Strait of Hormuz. At the same time, strong fuel demand is prompting refineries to continue purchasing and transporting crude. Under these conditions, high shipping costs are expected to persist in the near term. Rising costs in the global tanker market are significantly changing the economics of supplying oil to Asian markets.