Tanker Tariff Relief Boosts U.S. Crude, For Now

A drop in tanker tariffs has improved the price outlook for U.S. crude this month as it signals stronger demand. However, the relief might not last too long, as most tanker market forecasts for the year still predict rates much higher than they were in 2025.

“Shipping markets are freeing up and rates are falling from the US to Asia and from the UK to Asia,” said an analyst at financial services provider TP ICAP. said Bloomberg this week, adding that the trend was boosting demand for U.S. crude oil.

As a result, local benchmark prices in the United States have rebounded, although high-sulfur grades remain under pressure following President Trump’s declaration that the United States would take millions of barrels of Venezuelan crude.

The general freight rate situation, however, remains inflated. The reason is increased supply, both from OPEC+ and the US, which has restricted tanker availability. Last year, this situation led half a dozen new very large crude oil carriers to make their first journey empty rather than loaded with gasoline, which is a common practice. The reason they were traveling empty was to pick up cargoes of crude and collect the rising daily rates.

Unusual late-year strength has seen tanker rates on major shipping routes rise 467% since the start of the year, according to Bloomberg estimates released in December and based on data from the Baltic Exchange and commodity markets data provider Spark Commodities.

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Also last month, Lloyd’s List reported a sudden drop in tanker rates on the Baltic Stock Exchange, with VLCC rates falling by 20% between December 19 and 22. However, rates remained “the highest since the end of the spring 2020 floating storage boom,” at $83,882 per day. Freight rates for small tankers also remain high, Lloyd’s List noted in its report.

Part of the increase in tanker prices is attributable to American sanctions against Russian companies Rosneft and Lukoil, which came into force at the end of November. Tanker rates rose in anticipation of a reduction in the fleet Russia used to transport its oil. This week also brought support for tanker tariffs after the United States. continued a Russian-flagged tanker across the ocean and finally captured it in the North Atlantic. The ship, Bella 1, is under American sanctions. However, its seizure by US forces indicates intensifying geopolitical tensions which, combined with the limited availability of tankers, will likely keep freight rates high.

At the same time, supertanker fleet utilization rates are expected to hit a seven-year high in 2026, at 92%, up from 89.5% last year, a Jefferies analyst said in December. The utilization rate refers to the number of leased tankers as a percentage of all tankers on the market.

Sanctions are another factor that will increase tanker rates. The more sanctions the United States imposes on tankers, the fewer tankers remain available to transport crude around the world, Reuters noted in mid-December. report. Last month, sanctions and increased demand for tankers from OPEC+ pushed freight rates up to $130,000 per day, and although rates have fallen since then, they are still higher than they were a year ago. There is also a factor of aging tankers, the report notes, which limits tanker availability and supports higher rates. More and more tankers are being abandoned by oil companies once they reach the age of 15, as safety requirements become stricter. Nearly 44% of the world’s tanker fleet is 15 years old or older. Of these 44%, 18% are under sanctions, according to oil major Frontline. With so many factors reducing tanker availability, rates, while lower, will likely remain well above year-ago levels unless demand for oil declines, which is only likely if prices rise.

By Irina Slav for Oilprice.com

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