Tanker Shortage Sends Oil Charter Rates Soaring Amid US-Iran Tensions

The ongoing US-Iran conflict and the shutdown of Saudi Arabia's East-West oil pipeline have caused a significant shortage of tankers for transporting oil, leading to soaring charter rates.

In September, drone attacks on the pipeline forced crude oil shipments to be rerouted through the Strait of Hormuz, increasing the workload on tanker fleets. As a result, many supertankers are now being used for shuttle runs or taking longer routes, reducing their availability and driving up costs.

The charter rate for a supertanker transporting oil from the Persian Gulf through the Strait of Hormuz exceeded $1 million in early September, with an average daily profit of nearly double the pre-shutdown figure. The shortage is not limited to the Middle East, with freight rates rising on various global routes, particularly for shipments from West Africa to China.