Financial Times: War with Iran pushes tanker charter rates to a record $1.2 million a day
Shortage of ultra-large crude carriers (VLCCs) and war-driven risk lift freighter costs on key Middle East–Asia routes and beyond.
The Financial Times reports that the war with Iran, plus a shortage of VLCCs, has pushed daily tanker charter rates to about $1.2 million on key routes, with broad effects on fuel costs, refinery profitability, and insurance premiums.
Financial Times reports that a shortage of ultra-large crude carriers (VLCCs) has driven daily charter rates on key Middle East–China routes to a record roughly $1.2 million. The piece says the war against Iran is tightening ship capacity, forcing longer detours and higher costs across global energy markets. On the Middle East–China lane, the rate for the largest vessels—about 2 million barrels per ship—has more than doubled since late August, with other routes mounting similar increases (including Brazil–to–China shipments rising over 30% in the past week). Last year, VLCC daily rates ranged from about $20,000 to $50,000, and even before the conflict, Gulf shipments reached a record $120,000 per day in February. The surge in freight costs has pressured some refiners, reducing production despite surging fuel prices; diesel in Singapore is around $180 per barrel, while U.S. and European prices exceed $200 per barrel. Insurers’ war-risk premiums for vessels in conflict zones have climbed, in some cases reaching around 10% of a ship’s hull value, versus roughly 3% or less in lower-risk areas.