By Alex Longley and Christopher Charleston - Shipping crude oil from the US to Asia has reached record high prices, but some deals are already falling apart due to these soaring rates.
The global energy sector is experiencing significant challenges because of the escalating conflicts in the Middle East. This has resulted in rising oil prices, disrupted shipping routes, and concerns about increasing inflation.
As of Wednesday, it costs over $29 million to charter a supertanker for transporting two million barrels of crude oil from the US Gulf Coast to China, marking the highest price ever recorded, according to the Baltic Exchange in London. This cost is nearly double what it was just two weeks ago.
The shipping rate translates to about $14.50 per barrel, which is nearly 20% of the West Texas Intermediate (WTI) futures price, which was around $75 a barrel on Wednesday.
This week, WTI and the global benchmark Brent crude prices spiked after the US and Israel launched airstrikes on Iran, prompting retaliatory attacks from Iran on its Middle Eastern neighbors. This conflict has significantly disrupted traffic through the Strait of Hormuz, a crucial shipping route.
With the flow of oil from the Persian Gulf affected, buyers in Asia have started looking to US oil sources. Meanwhile, supplies from the Atlantic Basin have become more expensive, with price premiums rising sharply.
These developments have pushed prices for US oil grades like Mars Blend up, with its premium to WTI hitting the highest level since 2020, according to General Index data.
However, it's unclear how long this trend will continue.
Several supertanker bookings for loading crude from the US Gulf Coast that were being discussed this week have started to fall apart over the last 24 hours, according to Tankers International.
Thai refinery PTT had initially booked a ship for around $29 million, but that deal ultimately fell through, as reported by shipbrokers. It's not unusual for bookings to fail when rates change quickly.
On the key route from the Middle East to China, daily earnings have skyrocketed to $475,000, but the actual number of bookings has decreased due to the blockade in the Strait of Hormuz.
With tankers in short supply, charterers are now paying daily rates that are close to what offshore drillers pay to lease top-tier floating rigs. For context, Transocean Ltd charged an average of $470,000 per day for ultra-deepwater rigs during the last three months of 2025.