High earnings for the biggest oil carriers spread to smaller vessels.
The Next Inflation Shock
Bloomberg reports The Next Inflation Shock: $1 Million-a-Day Oil Tankers
Earlier this year, most shipowners would have considered $100,000 a day a superb price and $50,000 a good one. Poten & Partners, a shipbroker that prides itself on being old-fashioned, couldn’t hide its amazement at today’s rates, telling clients recently: “Even seasoned market veterans are looking at current developments in the market and scratching their heads. What’s happening is truly unprecedented.”
Sure, the $1-million-a-day price tag reflects the danger of crossing the Hormuz waterway and the fact that few shipowners are willing to take the risk. But costs elsewhere, even far from the Middle East, have also ballooned. The route from the Gulf of Mexico to Asia is about $338,000 a day, up 400% from a year ago; from West Africa to China stands at about $486,000 a day, an increase of nearly 500%.
The role of Sinokor is key. The South Korean company has become the largest owner of supertankers, having spent 2025 and early 2026 buying vessels from Greek shipping tycoons. Thanks to its new position as the market’s dominant player, it has been able to push rates higher. Now, demand is so intense that buying a second-hand VLCC, which can be used immediately, is more expensive (about $150 million) than ordering a brand new one and facing a two-year wait (about $130 million).
Yet the shipping industry is even more prone to boom-and-bust episodes than the rest of the notoriously cyclical commodity sector, making a correction likely. The shipyards provide a preview. The industry is “on course for the most VLCC orders in a calendar year in over 50 years,” according to Affinity Shipping, a shipbroker. When that tonnage materializes, starting in 2028-2029, it will push rates down. How much depends on the balance between new ships and decommissioned ones. Because of the lack of orders in recent years, the global tanker fleet has aged. Iran and Russia have kept VLCCs sailing well past their retirement age as part of the dark fleet. Ultimately, those tankers will be sold for scrap, helping the industry absorb the new arrivals. I doubt, however, that will be enough to avoid an oversupply in a few years, considering the size of the current order book.
For now, the tanker industry is sailing into an incredible bonanza.
Not Just Supertankers
Also note Record Oil Supertanker Rates Make Waves for the Whole Fleet
There’s no precedent for what’s happening right now in the supertanker market.
Disrupted by the Iran war and Houthi threats in the Red Sea, the cost of renting a ship to transport oil has soared to levels never seen before.
This trickle-down of record earnings from supertankers to smaller vessels is good news for the world’s shipowners. The largest oil tanker equities saw their valuation top $70 billion last week for the first time ever, according to data compiled by Bloomberg.
It’s just another indication of how the waves caused by President Donald Trump’s decision to go to war with Iran continue to spread through the global economy.
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poor little marco. i saw him speak on the same day as i saw trump speak in july of 2015, at the freedom fest in vegas. a large gathering of libertarians. it was funny to see little marco, but even funnier to see our fuhrer. 2 weeks after he came down the escalator at trump tower. i saw how magnetic and powerful an orator and future cult leader he was. my comment to my pals was i felt like i just saw mussolini in 1922 or hitler in 1932. how right i was.
The president has now stated he would be amenable to a ban or partial ban on the US 1.5 million barrels of diesel exported daily. If he EO’d (executive ordered) a 200% export tariff (he likes the tariffs)(about 7-800 dollars) on each barrel to defray the military cost of the Iran war for US taxpayers, he would provide US international oil corporations an option, rather than a nasty ban. In 60 days, if they did choose the option, 45-60 billion would be in the national coffers, less the presidential %. (Satire.)
As I recently posted elsewhere:
Cha-ching! The API’s for last week are out today. Crude had a slight build, but products rocked and dropped!
Gasoline inventories fell 2.16 million barrels in the week ending September 18. In the week prior, gasoline inventories rose by 1.46 million barrels. In the week prior, gasoline inventories were 5% below the five-year average for this time of year, according to the latest EIA data.
Distillate inventories dropped as well, by 2.164 million barrels, on top of the 1.61-million-barrel gain in the week prior. Distillate inventories were 13% below the five-year average heading into this reporting period, the latest EIA data shows.
As long as Wed’s DOE data are close to this it is EXCELLENT news for the refiners (supportive for products and crack margin prices).
2 Big reasons:
1.) NO Demand Destruction from off the chart diesel prices. (Most/I would have expected.)
2.) Nice gasoline draw to means it’ll provide crack strength too.
3.) Bonus: Draws as we’re hitting prime refinery maintanence times on 5-yr Product Inventory lows is EXCEPTIONALY constructive. Trump shouldn’t have pissed-off EPA mileage increases. (Along with a million other studipities…) It only stretches out fuel prices and inflation.
(Remind me to increase by refining holdings in the AM!)
I’m shocked the cost is normally so low (50K and under). The vessels must be largely automated with small crews and not need much overall maintenance.
Our customers in the offshore drilling industry typically run costs in the 300-500K a day range for vessels that drill or lay cable/pipe.
Well guess whos gonna pay that cost.
Oil is priced globally. So expect record profits in markets that do not rely on shipping. .
Shipping costs are separate from the price of oil itself.
By the time it gets to the pump we are paying for both.
Where do you live?
Here in the US we don’t need super tankers to bring oil to us. We get ours directly from the ground + pipe line + rail.
Join the navy?
This seems inflationary.
What’s the insurance rate for the vessel?
What’s the insurance rate for the cargo? Loss. Delay.
Rubio &Co. blame Ukraine because the War on Iran cannot be readily blamed on Biden.
Team R strategy is basically “blame Biden”. Why is Trump Israel’s little bitch? “It’s Biden’s fault!”
Who knew the senile old fool.had such power!
A strong man accepts responsibility, a weak man blames others.
To be fair, Biden was blaming Trump, who was blaming Obama, who blamed Bush….
And with narcissists it’s never their fault.
Sounds great, but I’m betting the costs and downsides for people who coin sayings like that, is lower than those who actually accept such responsibility. I mean to say, there is probably a little bit of the error-prone dodger at some point in any of us. Just not to the cosmic level of Trump.
I do like Harry Truman saying “the buck stops here,” and “if you can’t stand the heat, get out of the kitchen,” because he was standing dead center in the hot kitchen at the time. But that was a world in which, after his presidency, he and Bess could and did just hop in an actual car all by themselves and take a road trip across the USA. It wasn’t like a Bolshevik gulag kitchen or something.
Costs will go up for everything, but that is by design. The rich get richer as asset prices rise.
This week will determine whether Trump plunges the world into WWIII before the election. If he can’t get Iran and China concessions he’ll have no hope for the mid-terms and see his only option is a major war that will freeze world trade and allow him to cancel the elections – typical of dictators everywhere.
Trump has nothing to lose.
When the European Colonial Powers saw their colonies exhausted of cheap resources, they turned on each other not only once, but twice in the previous century. The only remaining Colonial Power from then were the US, which came out unscathed from the conflict and made of the others their vassals and tributaries, along with former colonies. Again, almost a century later, it’s the US which are finding themselves with exhausted colonies and smacking their lips at the other Colonial Powers, even siccing them against rival powers. It’ll end up like the prior two Colonial Wars, this time with all the Colonial Powers destroyed and hollow out.
Like everyone else who is more or less free, Trump has his freedom to lose. He has learned how to operate amongst crooks while not breaking the law himself, as a real estate developer: they have to deal with local politicians, who are a very bad kind of crook. He was subjected to appalling misuse of the law against him and his friends between his two terms of office, and he survived that and came back. He is one tough cookie.
On your first paragraph, don’t blame Trump for what happens in every inflation. Our inflation has been going on since the suspension of payment in gold in year 1914. Trump didn’t start it. I don’t suppose he understands it or has a plan to end it.
The idea that Trump didnt break the law as a real estate developer is laughable. Just ask all the black people he discriminated against, and the workers he didnt pay. Or the girls he abused with epstein.
He is such a tough cookie that he dodged the draft.
We do agree that he has no understanding about inflation, let alone a plan to do something about it.
There may be some judgment calls on what this might add up to, but at least an entertaining video is particularly the earlier dealings setup described in: “They Dumped Trump’s Toxic Waste And Ended Up Dead | Part 1 of 2 | Sammy “The Bull” Gravano”:
https://www.youtube.com/watch?v=DAwhgRcLIHA
Trump is less free than a dog with a shock collar.on his nuts.
You have to worry about politicians that are only concerned with their legacy,,,primarily worried about lame-duck politicians with nothing to lose as stated above.
I wonder how much the American public has had to absorb in increased fuel costs since the bombing of Iran? Households are getting clobbered with increased energy costs due to the foolish (and avoidable) war with Iran.
Nobody cares about American households, except as they provide suckers.
Every day this blog comment section gets more delusional….and yet 5 upvotes.
Care to wager any amount of money on any of the bs claims you make? I mean any amount. He is so dictatorial that despite wanting lower federal funds rates they raised them. The guy he appointed. He can’t even control the Fed to keep rates steady let alone make them go lower. He’s such a dictator that he’s lost numerous SCOTUS rulings despite his placement of 3 justices on that 9 justice body! You know that real dictators do? They roll Panzers, burn down Reichstags. The rhetoric is tiring.
WWIII
Freeze world trade
Cancel Elections
Did I miss any other embedded preposetrous NEVER GONNA HAPPEN claims in your comment?
You started out the comment fine–costs will go up, that is by design, the rich get richer as asset prices rise. True. What do you want done about it? Wanna see the stock market, basically at ATH today, fall? 401k/IRA holders are complicit–they don’t want them to fall. Want your house to go down in value? I’m okay with both of those happening because they fuel the inflation and are passive gains handed out by TPTB through debt financing. But are you? Infaltion went up, what, about 25% over Biden’s term. Seems pretty constant thanks to flawed monetary policy backing flawed fiscal policy.
You backing any sound money politicians or policies or you just spitballing 3 whack-a$$ ideas at Trump, none of which have happened or will happen at his behest.
Iran is no more WWIII than Libya, Syria, Afghanistan, Iraq was in the D years.
Not even tariffs have frozen world trade.
Cancel elections….sure, that’s happened precisely nowhere in the US in my lifetime.
But state it, get 5 up votes, consider yourself clever. What’s happened to this blog.
Salazar was a “real dictator”. He didn’t “roll panzers” or “burn the Reichstag”.
He had been an accounting professor at one time.
Could we put him on the ballot by chance? I’d kill for a dictator who could do simple math and sign his own name.
Salazar was just the first example to come to mind of a dictator who didn’t exactly come to power by a coup. (In fact, when he was Finance Minister, he kept resigning or trying to resign, and the military government asking him back. He only reluctantly took the job of Prime Minister.)
For a “real dictator”, Salazar was an interesting case. He was quiet, unassuming, hard-working, not a military man at all, and came to power largely because of his ability to reform Portuguese government accounting.
The Estado Novo was definitely authoritarian. One certainly could end up targeted by the secret police, and one could end up in one of their prisons, which were Not Fun. The Estado Novo might be described as “fascist”, but at the same time, it insisted that being Portuguese or a citizen did not necessarily stem from race or ethnicity at all.
Most people in Portugal were hella poor, literacy remained low, etc..
My favorite Salazar story was that, after the man had basically been sidelined following a stroke, his staff were so terrified of him that they pretended that he was still in power, and he may have knowingly gone along with the charade.
1.) Yes, by comparison to the worst offenders in history, Trump is a cream puff. I chalk that up to our stronger diverse free people and institutions pushing back at him (and even their inertia), and Trump’s mental aberrations making him unworthy of being a breakfast snack for a guy like Stalin. If he could pull of worse, he would.
2.) Yes, Dems in things like the Arab Spring and elsewhere, have shown incompetence and venality. Hillary for example in foreign policy thinking I consider almost approaching the horrible Repubs of. the 2000s. She voted for Gulf War 2. Trump called out the Chinese more.
3.) None of this is much of a vindication of Trump, second term. This is a straw-person argument, posing set-up comparisons, with nothing much to say about Trump’s constant attempted, and sometimes successful, outrages.
if it does come to the point of the world’s fate versus Trump’s psychological self-image maintenance, he will throw the world under the bus.
Costco & Walmart costs up 400% on shipping. All thanks to Trump and his stupid voters.
https://www.youtube.com/watch?v=JW0G5vFL7yU
I had been warning people 18+ months ago to stock up on food: rice, beans, canned goods, etc. Those that didn’t still have a little time left before the Walmart riots start after empty shelves.
Do worry, Trump, Walrus, GOP, and democrats will find a way to make things even worse.™
The Trump Grinch will steal Christmas; Winter is coming.
I look forward to feasting on Roast Rioter.
Didn’t u tell everyone to stock up on TLT 12-24 months ago or am I confusing u with another commenter here??
Yes i have been buy-writing TLT for a while now collecting a nice dividend and premiums. I expect it to go lower until Trump crashes the global economy and the Fed will be forced to cut rates down the road. This is a long term play not a day trading strategy.
How do the Walmart riots work in areas with heavy drone deliveries?
Porch pirates with torches and pitchforks
hourly cost of expending a calorie of work to acquire a calorie of nutritious food keeps plummeting in the world. in the rich world, the likelihood of people starving is approaching zero.
Food cost is up everywhere, dont know what you are talking about.
Big winners in Iran War shipping mess: oil tankers making $1 million a day, and Chinese shipyards
https://kdwalmsley.substack.com/p/big-winners-in-iran-war-shipping
That music is such a subtle dig, you have to be paying attention to catch it. I know Trumpstien didn’t pick up on it, and lil’ Marco is at least doing a good job of pretending he didn’t.
I wonder what “The Merrygoround Broke Down” sounds like at half tempo in a minor key?
Somebody had to do something? Obama did do something! Diplomacy was working! Then shit for brains got bored one weekend and thought he’d “go kill him some rag heads”. Nice try Rubio, but they don’t call it a war of choice for nothing.
There was something going on at the time that had the potential to make him look really, really bad. Some kind of files maybe? My memory falters…