Hormuz Tanker Rates Skyrocket as Middle East Producers Flood Global Markets

Oil tanker operators are reaping record profits after nearly doubling the hire cost of vessels going through the Strait of Hormuz and wider Gulf region this week.

This surge in demand is due to rising traffic through the waterway, which has been modest since Iran lifted its effective blockade last week following a 60-day ceasefire with the U.S., as talks on a permanent deal to end their war continue.

The number of ships going through Hormuz remains a fraction of the daily average of 125 before the conflict began on February 28, with up to 100 tankers still stuck inside the Gulf with cargoes onboard.

As Middle Eastern crude producers ramp up exports, tanker rates have jumped significantly. Outside the Strait of Hormuz, hire costs have risen to $190,500 a day from $106,500 a week ago.