Earnings for supertankers on the benchmark Saudi Arabia-to-China route hit $647,000 a day on Thursday, a record that sits more than ten times above the level seen a year ago, as the Iran war and a pre-emptive fleet buildup by South Korea's Sinokor Group rewrite the economics of moving crude through the Strait of Hormuz.
Sinokor's bet pays off
The surge began late last week when Sinokor, the world's largest supertanker operator, told market participants it had fixed vessels at elevated rates. The company, led by Ga-Hyun Chung, spent the early part of this year acquiring dozens of ships before the conflict erupted, a wager that now looks exceptionally well timed. Those vessels are being hired out at the heightened rates the war created.
A benchmark broken
Before hostilities, the Saudi-China route served as the primary proxy for global supertanker earnings, with substantial derivatives exposure tied to the marker. The Iran war has made ship movements in and out of the Persian Gulf increasingly opaque, severing that link. What remains is a two-tier cost structure: a lump sum to transit Hormuz, then a separate, lower rate for the Oman-to-China leg.
The Oman leg climbs too
That secondary rate has climbed to roughly $220,000 a day from $131,000 a month ago. TotalEnergies chief executive Patrick Pouyanne put the all-in cost of moving barrels through Hormuz at about $20 million earlier this week; two market participants said the figure has risen further since. The arithmetic is simple: higher export volumes from Gulf producers are chasing a shrinking pool of owners willing to risk the waterway.
Detours eat supply
Houthi attacks on Saudi tankers have forced the kingdom to reroute some exports north through the Mediterranean and around Africa, adding roughly 30 days to voyages bound for Asia. Meanwhile, the practice of switching cargoes onto different vessels once clear of Hormuz consumes additional tonnage. Every extra day at sea is a day a ship cannot earn elsewhere, and the market is pricing that scarcity ruthlessly.