The ongoing crisis in the Middle East has created significant disruptions in global oil markets, leading to an increase in crude oil prices since Monday. This rise presents both challenges and opportunities for the shipping industry, particularly in the tanker market, where VLCC rates also noted increase following the seasonal pattern.
Analysts at Clarksons Securities believe VLCC rates could surge to $100,000 per day if each OPEC+ member follows through on production rises
After the recent Iranian missile strike, speculation is growing around Israel’s possible reaction, potentially targeting Iranian oil infrastructure.
According to Reuters, OPEC has sufficient spare capacity to offset a complete loss of Iranian oil supply if Israel targets Iran’s facilities, but it would face challenges if Iran retaliates by hitting installations of its Gulf neighbours.
As escalating regional risks heighten concerns over the safety of maritime shipments, shipowners are expected to increase insurance premiums, which will in turn drive freight rates higher.
However, the situation remains highly fluid. Any further escalation in geopolitical tensions could drastically alter the supply-demand balance, potentially sending oil prices soaring, says Signal’s analyst.