PARIS: The cost of shipping oil cargoes on a supertanker through the Strait of Hormuz is about US$20mil, the boss of TotalEnergies SE says, underscoring the wide margins to be made by traders and shipowners.
TotalEnergies chairman and chief executive officer Patrick Pouyanne said the company is buying barrels at US$50 to US$60 inside the Persian Gulf as producers are desperate to get their supplies onto the market following six months of conflict.
The additional freight costs for a supertanker equate to about US$10 a barrel, he said.
Benchmark Brent futures were trading above US$90 on Monday.
The French energy giant is one of the largest traders of oil from Iraq and Qatar, two countries that have continued to move barrels through Hormuz in recent weeks, Pouyanne added.
A growing number of producers have been ferrying cargoes through the critical waterway, which before the Iran war carried about a fifth of the world’s oil flows.
Those volumes have helped prevent a surge in global prices beyond US$100 a barrel, but also offer lucrative trading opportunities for shipowners and middlemen.
While some shipments sail directly to refineries around the world, many are loaded onto ships in the Gulf of Oman, before being taken to their eventual destinations.
Pouyanne said that there’s a split between crude oil markets, which look bearish, in part thanks to flows through Hormuz, and fuel markets that remain tight.
Prices of products like petrol and diesel have rallied due to Ukrainian attacks on Russian refineries and the fact that crude dominates Hormuz shipments. — Bloomberg
