Oil transport costs surge to an astonishing new high due to blockage in the Strait of Hormuz

智通财经2026/10/07 16:41

Show original

The cost of renting very large crude carriers (VLCCs) to transport crude oil has surged to record highs, adding substantial expenses to the oil supply chain. According to data from the London Baltic Exchange on Wednesday, the cost of chartering a VLCC to deliver US crude oil to Asia is $77 million. The average level for 2025 is forecasted at $9.2 million. Although the main crude oil futures prices are currently trading around $100 per barrel, these futures are typically based on the grade of crude oil at the export location. For a cargo of 2 million barrels, freight charges mean an additional delivery cost of about $38.50 per barrel. In some markets, such as West Africa, exporters are forced to discount their cargoes at the export location. The Iran war has caused disruption in the tanker market, reshaping the way oil is shipped from the Middle East and significantly increasing transportation times. Although crude flows from the region have rebounded in recent weeks, trading routes are far more complicated than before the Iran war, resulting in longer delivery times and a substantial reduction in the effective capacity of the fleet.

Bitget offers one-stop trading for cryptocurrencies, stocks, and gold. Trade now!

A welcome pack worth 6200 USDT for new users! Sign up now!

The cost of chartering Very Large Crude Carriers (VLCCs) to transport crude oil has soared to a new high, adding significant expenses to the oil supply chain. According to data from the London Baltic Exchange on Wednesday, hiring a VLCC to ship US crude oil to Asia now costs $77 million. The average level for 2025 is $9.2 million. Although benchmark crude oil futures are currently trading at around $100 per barrel, these contracts are usually based on the grade of crude oil from the export location. For a shipment of 2 million barrels, freight costs add about $38.50 per barrel to delivery expenses. In certain markets such as West Africa, exporters are forced to sell cargoes at a discount at the export site.The Iran war has disrupted the tanker market, reshaping the way oil is shipped from the Middle East and significantly increasing transportation times. Although crude oil flows in the region have picked up somewhat in recent weeks, trading processes remain far more complex than before the Iran war, resulting in longer delivery times and effectively causing a substantial reduction in fleet capacity.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

Understand the market, then trade.

Bitget offers one-stop trading for cryptocurrencies, stocks, and gold.

Trade now！

The US Dollar Index, which measures the dollar against six major currencies, rose by 0.4% on the day, closing at 102.242 in the late New York forex market. By the close, 1 euro exchanged for 1.1199 US dollars, down from the previous session's 1.1261 US dollars; 1 British pound exchanged for 1.3219 US dollars, down from the previous session's 1.3277 US dollars. 1 US dollar exchanged for 157.96 Japanese yen, down from the previous session's 158.12 yen; 1 US dollar exchanged for 0.8330 Swiss francs, up from 0.8313 Swiss francs; 1 US dollar exchanged for 1.4256 Canadian dollars, up from 1.4209 Canadian dollars; and 1 US dollar exchanged for 9.9992 Swedish krona, up from 9.9861 Swedish krona in the previous session.

智通财经•2026/10/07 20:01

The US Dollar Index rose by 0.4%, closing at 102.242.

New York oil prices closed down 1.3%, Brent crude oil fell 0.38%.

At the close of trading, the November delivery light crude oil futures price on the New York Mercantile Exchange fell by $1.16, settling at $88.28 per barrel, a decrease of 1.3%. The December delivery Brent crude oil futures price in London fell by $0.38, closing at $100.20 per barrel, a decrease of 0.38%.

智通财经•2026/10/07 20:00