Oil shipping rates surge after US sanctions tighten global fleet

Siyi Liu - Reuters - 14/01
Supertanker freight rates jumped after the U.S. expanded sanctions on Russia's oil industry, sending traders rushing to book vessels to ship supply from other countries to China and India, shipbrokers and traders said.
  • VLCC rates for Mideast to China up 39% since Friday
  • Shipping costs for Russian ESPO Blend to China more than double - S&P Global
  • Fleet tightness could worsen if shadow fleet seeks new vessels - Kpler
SINGAPORE, Jan 14 (Reuters) - Supertanker freight rates jumped after the U.S. expanded sanctions on Russia's oil industry, sending traders rushing to book vessels to ship supply from other countries to China and India, shipbrokers and traders said.
Chinese and Indian refiners are seeking alternative fuel supplies as they adapt to severe new U.S. sanctions on Russian producers and tankers designed to curb the world No. 2 oil exporter's revenue.
Many of the newly targeted vessels, part of a "shadow fleet", have been used to ship oil to India and China, which snapped up cheap Russian supply that was banned in Europe following Moscow's invasion of Ukraine. Some of the tankers have also shipped oil from Iran, which is also under sanctions.
The latest U.S. action means an estimated 35% of some 669 dark fleet tankers involved in shipping Russian, Venezuelan and Iranian oil have been hit with sanctions by either the U.S., UK or EU, according to analysis by Lloyd’s List Intelligence.
Freight rates for Very Large Crude Carriers (VLCCs) that can carry 2 million barrels of crude across major routes jumped after Unipec, the trading arm of Asia's largest refiner Sinopec (600028.SS), opens new tab, ...
[Short citation of 8% of the original article]