India’s Oil Tanker Rates Jump Amid Rising Russian Crude Imports

Global oil tanker rates have climbed to levels not seen since 2020, driven by buyers urgently rerouting their crude purchases away from sanctioned Russian suppliers. It has created a surge in demand for large crude carriers, particularly on long-haul routes connecting the Middle East to Asia.

VLCC Rates Surge on Key Routes

Benchmark earnings for very-large crude carriers (VLCCs) ships that can move up to 2 million barrels at once have jumped to nearly $137,000 per day on Middle East–to–China routes. This marks a 576% surge this year, reflecting one of the sharpest jumps seen in the tanker market since 2020.

A wider index that tracks several major routes also climbed to $116,400 per day, showing how strong the demand for big oil carriers has become across the global market.

Why Are Oil Tanker Rates Rising?

Recent US sanctions on Russian oil exporters such as Rosneft and Lukoil have forced many refiners, especially in India and China, to seek alternative suppliers. With more crude coming from the Middle East and the US, buyers are booking more ships, pushing oil tanker prices and shipping costs even higher.

Analysts also point out that OPEC+ countries, mainly in the Middle East, have increased their output. This added supply has created more demand for tankers and tightened the entire oil supply chain.

More Bookings for November and December

The market shift is already visible in chartering activity. 

Last week alone, several bookings were made for late November and December loading windows, with close to a dozen VLCCs approached for Middle East liftings. 

As more buyers try to secure vessels, shipowners are earning better returns and have more options to choose profitable routes.

Smaller Carriers Gain as Oil Tanker Rates in India Continue to Climb

It’s not just the biggest ships benefiting. Suezmax tankers, which carry roughly half the volume, are now moving into Middle Eastern routes usually dominated by larger carriers. 

Vortexa freight team adds that this movement indicates shipowners are chasing higher returns across regions as the cost of transporting crude continues to climb.

Conclusion

Product tankers usually assigned to diesel, jet fuel, or other refined products are also switching to crude in a process called “dirtying up.” This change highlights how elevated freight markets have made crude oil transport far more attractive than product shipments.

Source: MoneyControl

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