Record tanker rates choke US crude flows to Asia as fuel oil spikes

· Oil & Gas · United States · Singapore

War-driven disruption to tanker voyages has made shipping so inefficient that freight costs hit record highs, all but erasing the incentive to move crude from the US Gulf Coast to Asia; the cost to ship to China rose to as high as $80 million. In Singapore, disrupted supplies from the Middle East and Russia, resilient bunker demand and prohibitive freight pushed high-sulphur fuel oil above the price of the crude used to produce it, adding a new cost layer to Asian trade. The two markets show how the conflict is reshaping physical oil flows and refining economics far beyond the Middle East.

Why it matters：Freight has become the binding constraint on global crude trade, redirecting flows and raising fuel costs for Asian refiners and shippers.

Key points

  • US Gulf Coast-to-China freight reached as high as $80 million.
  • High-sulphur fuel oil in Singapore now costs more than the crude it is made from.
  • Middle East and Russian supply disruptions are cited as drivers.

Sources (original reporting)

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