High-risk oil shipments through Persian Gulf surge amid record payouts

Sailors are being offered as much as $25,000 per trip to transport oil through the dangerous Persian Gulf, where strikes and drone attacks have intensified. This extraordinary incentive, sometimes worth two or three times a sailor’s typical monthly salary, aims to attract crew members willing to navigate the war-torn waters. Producers are reportedly spending up to $40 million for a multi-day trip through the region, according to the Wall Street Journal.

Despite the risks, crude exports through the Strait of Hormuz have surged to 16.5 million barrels per day in September, a significant recovery from the lows of 5 million barrels per day in March when the Iran war began. However, recent attacks on vessels have escalated, with nine commercial vessels targeted in just the past two weeks, resulting in injuries and one fatality.

To move the oil, producers are hiring very large crude carriers (VLCCs) to perform treacherous “shuttle runs.” These operations involve entering the Gulf, loading oil at ports, and transferring it to another vessel outside the strait. The cost to hire an oil supertanker to China has skyrocketed to over $1.2 million per day in late September, up from $231,400 before the war and less than $40,000 in January.

Many crew members from India, the Philippines, and China are accepting the high-risk trips, with some lower-level workers earning payments that exceed their annual salaries. These dangerous voyages often require moving at night with lights off and GPS signals disabled. Meanwhile, global oil prices have eased slightly, with Brent crude futures dipping 1.5% to $100.74 per barrel and West Texas Intermediate crude slipping 1% to $90.16 per barrel.