Oil majors count the cost of runaway tanker rates

· Shipping

Soaring tanker freight rates are taking an increasingly heavy toll on the world's oil majors, with the latest quarterly results revealing billions of dollars in additional shipping-related liabilities, squeezed refining margins and losses on trading positions. Shell disclosed a $5.4 billion non-cash increase in its shipping-related liabilities in its latest results. The disclosures show how higher freight costs tied to market disruption are now flowing through the earnings of the largest oil companies, not just shipowners and traders, as tanker rates have risen sharply and stayed elevated.

Why it matters：Shipping costs have become material enough to move the earnings of the largest oil companies, a sign that freight is shifting from an operational expense to a strategic risk that shapes refinery runs and trading strategies.

Key points

  • Shell disclosed a $5.4bn non-cash increase in shipping liabilities
  • Refining margins were squeezed and trading positions booked losses
  • The impact is showing up in oil majors' quarterly results

Sources (original reporting)

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