According to the head of TotalEnergies SE, shipping oil on a supertanker through the Strait of Hormuz costs about $20 million. This highlights the significant profits available for traders and shipowners.
Patrick Pouyanne, the Chairman and CEO of TotalEnergies, mentioned that the company is purchasing oil barrels for $50 to $60 in the Persian Gulf. This is due to producers wanting to sell their supplies after six months of conflict. He noted that the extra cost for shipping on a supertanker is approximately $10 per barrel. On Monday, benchmark Brent futures were priced above $90.
TotalEnergies is one of the leading traders of oil from Iraq and Qatar, countries that have continued to send oil through the Strait of Hormuz in recent weeks, Pouyanne added.
An increasing number of producers are transporting their cargoes through this important shipping route, which used to handle about 20% of the world’s oil before the Iran war. These shipments have helped keep global oil prices from exceeding $100 per barrel while also creating profitable opportunities for shipowners and intermediaries.
Although some shipments go directly to refineries around the world, many are first loaded onto ships in the Gulf of Oman, which then bring them to their final destinations.
Pouyanne also pointed out that there’s a divide in the oil markets. The crude oil market seems to be weakening, partly because of the flows through Hormuz, while the fuel markets remain tight. Prices for products like gasoline and diesel have risen due to Ukrainian attacks on Russian refineries and the fact that crude oil shipments dominate in Hormuz.