Costs for hiring tankers that can carry 2mn barrels of crude oil across the world are experiencing unprecedented volatility. Instability has been a feature across the tanker market ever since Russia’s invasion of Ukraine in 2022, and this has been compounded by the Houthi’s Red Sea campaign of 2024-2025 and the ratcheting up of western sanctions on tankers. This year, a confluence of market and geopolitical events is pushing the cost of renting a very-large crude carrier (VLCC) to six-year highs.
Current spot prices for fixing a VLCC from the Gulf to China are hitting $200,000/day, equivalent to nearly $5/B. For comparison, rates briefly spiked last year when Israel struck Iran kicking off the June 12-day war (MEES, 20 June 2025). Even with missiles flying over the Gulf, and concerns over a blockade of the Hormuz Strait, rates only rose from around $20,000 ($1.22/B) to a little over $50,000 a day ($1.93/B) for a brief period of time. With rates swiftly falling back after the conflict ended, on a monthly basis the conflict barely had an impact. (CONTINUED - 1582 WORDS)
