Hormuz Crisis Sends Oil Shipping Costs Soaring. Supertanker Rates Have Jumped More Than Eightfold.

The cost of moving oil across the world has surged to extraordinary levels as disruptions around the Strait of Hormuz scramble traditional shipping routes, tighten tanker availability, and add another layer of expense to already elevated crude prices.

Hiring a very large crude carrier, or VLCC, to transport U.S. oil to Asia now costs about $77 million, according to Baltic Exchange data from Wednesday. That compares with an average of just $9.2 million in 2025, an increase of more than 800%.

The increase means shipping alone can dramatically change the real cost of a barrel by the time it reaches a refinery. A VLCC typically carries around 2 million barrels of crude. At the current $77 million freight rate, transportation adds roughly $38.50 per barrel to the cost of a U.S.-to-Asia shipment.

With benchmark oil futures trading above $100 a barrel, freight can therefore add nearly 40% to the headline price before accounting for other costs associated with getting crude to its final destination.

The surge is another consequence of the Iran war and the resulting disruption to tanker traffic around the Strait of Hormuz, one of the most important energy chokepoints in the world.

The narrow waterway connects the Persian Gulf with the Gulf of Oman and the Arabian Sea, making it a critical route for oil and liquefied natural gas exports from major Middle Eastern producers.

While regional oil flows have begun recovering in recent weeks, the tanker market has not returned to anything resembling its prewar operation. Shipping crude out of the Middle East has become more complicated and time-consuming, forcing traders and tanker operators to adjust routes, schedules and loading strategies.

Longer voyages effectively remove ships from the available global fleet for extended periods, creating a shortage of usable tanker capacity even without a corresponding reduction in the total number of vessels.

That shortage is pushing freight rates sharply higher. The consequences are spreading well beyond the Persian Gulf. Refiners seeking replacement barrels from the United States, West Africa and other producing regions are competing for ships capable of making longer journeys.

At the same time, producers farther from major Asian buyers are finding that soaring transportation costs can make their crude less competitive. In West Africa, some sellers have been forced to discount crude at the export point to compensate buyers for the additional cost of shipping it to refineries.

Normally, benchmark futures such as Brent and West Texas Intermediate provide investors and consumers with a broad indication of oil prices. But those contracts generally reflect crude at or near its point of export. They do not capture the full cost of physically transporting barrels thousands of miles through a tanker market experiencing historic dislocations.