VLCC Tanker Rates Hit Record $1M a Day as Hormuz Traffic Collapses

Oil tanker rates have surged to extreme levels as traffic through the Strait of Hormuz remains heavily disrupted.
The cost of chartering a VLCC from the Persian Gulf to China has reportedly reached roughly $1.035 million per day.
That is nearly five times the roughly $208,000 daily rate seen before the Iran war.
Only 17 commodity vessels crossed the Strait of Hormuz over the weekend, down from 37 a week earlier and compared with roughly 125 large commercial vessels per day before the conflict.
The collapse in traffic has created a severe shortage of tankers willing to enter the Gulf.
That is becoming a major earnings tailwind for spot-exposed tanker operators including $FRO, $INSW and $DHT, which can benefit directly from higher charter rates.
The economics have become attractive enough that commodity trader Trafigura is launching its own VLCC company, Volare Shipping.
The business already has six tankers operating and another eight on order ahead of a planned Oslo listing.
The longer Hormuz traffic remains depressed, the more the energy shock shifts from crude prices alone into shipping capacity, freight costs and the profitability of tanker operators.