Hormuz Tanker Transits Crash to Single Digits as Crisis Deepens

Only nine commodity carriers passed through the Strait of Hormuz on Thursday, eight of them exiting the waterway, Reuters reported in its now regular update on tanker numbers in the strait.The Thursday total is a further decline on already depressed numbers that have now gone from double to single digits, with the 10-day average at 18. The nine tankers that passed through Hormuz yesterday included one very large crude carrier, several Panamaxes and Supramaxes, short- and medium-range smaller carriers, and one ballast very large gas carrier, the report said.Windward, meanwhile, reported five tankers entering the Strait of Hormuz on Wednesday, including a crude oil carrier, a couple of product tankers, and one liquefied natural gas carrier.Owners and energy exporters are becoming increasingly careful navigating through the Strait of Hormuz amid re-escalation of hostilities this month, including strikes on tankers, the threat from the Iran-aligned Houthis in the Red Sea, and the temporary shutdown of the East-West onshore pipeline in Saudi Arabia.Set OilPrice.com as a preferred source in Google here.The situation has deepened a shortage of tankers that emerged earlier this year due to shipowners’ unwillingness to risk the Strait of Hormuz. The shortage, in turn, has led to a surge in shipping costs for the Persian Gulf, with the rate for a very large crude carrier on the route from the Persian Gulf to China hitting an all-time high of $1.27 million this Monday before retreating modestly to $1.26 million, according to Lloyd’s List. “Crude tanker spot rates are still at astronomical levels that were unimaginable before the Hormuz crisis,” Greg Miller, author of the Lloyd’s report, noted.In addition to this, Saudi Arabia’s ramp-up of oil exports via the Strait of Hormuz and Gulf of Oman has further deepened the tanker shortage, with Reuters reporting earlier today that the Gulf capacity for ship-to-ship transfers has reached its limits as a result of the surge in Saudi flows from the western port of Yanbu and its eastern ports on the Persian Gulf.By Irina Slav for Oilprice.comMore Top Reads From Oilprice.comSaudi Oil Export Costs Surge as Red Sea Risks MountBrent Set for Weekly Gain as Houthi Attacks Rattle Saudi Oil SupplyVLCC Rates Hit Record $1.27 Million a Day