Hormuz Bottleneck Costs Tanker Owners $650k Daily Amid Iran War
The ongoing Iran war has had an unexpected consequence on the global oil market. The Strait of Hormuz, through which much of the world's crude oil passes from Persian Gulf producers to Asia, has become a bottleneck for tanker owners.
Earnings on the benchmark Saudi Arabia-to-China supertanker route have surged to a record $647,000 per day on Thursday, according to Baltic Exchange data. This is more than ten times the rate a year ago and nearly 27% above the previous high of $510,000 just ten days earlier.
The sharp increase in costs comes as Persian Gulf producers continue to ship crude oil through the Strait despite ongoing conflict with Iran. However, few tanker owners are willing to send vessels through Hormuz due to the risks involved, leaving exporters competing for a smaller pool of willing ships.