The cost of shipping crude oil from the United States to Asia has jumped to record levels as the war in the Middle East disrupts global energy supply routes, according to a report by Bloomberg.
The price of hiring a supertanker to carry about two million barrels of crude oil from the US Gulf Coast to China has risen to more than $29 million, which is nearly double the rate from two weeks ago.
The sharp increase in shipping costs is mainly due to the growing conflict in the region, which has disrupted tanker traffic through the Strait of Hormuz, one of the world’s most important oil shipping routes. Because supplies from the Persian Gulf are affected, many Asian buyers are now turning to US crude oil, increasing demand for long-distance shipping.
At current rates, shipping alone now costs about $14.50 per barrel, which is almost 20% of the price of West Texas Intermediate (WTI) crude, currently trading near $75 per barrel.
Compared to August, the cost of hiring a supertanker relative to the price of oil has increased nearly four times. At that time, freight costs made up only about 5% of the oil price.
However, the high shipping costs are starting to affect global oil trade. Some planned supertanker bookings from the US Gulf Coast have already been canceled in the past 24 hours because the high transportation costs are making certain export deals less profitable.
