Locator: 51984B.
Updates
October 21, 2026: WTI --- $97.86.
Original Post
Posted Tuesday Eveninig
WTI: $99.26, up $1.44, up 1.47%. This is closer to $100 than $90.
New wells reporting:
- Thursday, October 22, 2026: 55 for the month, 55 for the quarter, 554 for the year,
- 42444, conf, SOGC, Forest 2-1 HLE,
- 41407, conf, Enerplus, Crying Tree 147-97-8-5-9H-ELL,
- Wednesday, October 21, 2026: 53 for the month, 53 for the quarter, 552 for the year,
- 41920, conf, Hess, GO-Barb-LE-157-97-3523H-1,
- 41475, conf, Enerplus, Crying Tree 147-97-8-5-8H,
- 41474, conf, Enerplus, Crying Tree 147-97-8-5-7H,
RBN Energy: attacks, altered crude flows, unbalanced fleets push tanker freight rates to record levels. Link here. Archived.
Freight rates are sky-high right now. Japanese oil major Cosmo Oil chartered a 2020-built Very Large Crude Carrier (VLCC) on October 8 to ship 2 MMbbl of crude oil from the U.S. Gulf Coast for $81 million, double September's market rate and about 5X a year ago. Higher rates show that freight, not the price of crude, has become the swing cost for moving Atlantic Basin barrels to the far east. In today's RBN blog, we look at the unique combination of factors, including new routes for Middle Eastern crude and increased purchases by China, that are helping drive freight rates to record highs.
Here at RBN, we regularly track crude oil tanker voyages and freight rates, but this topic has rarely (if ever) made it into our blogosphere. That said, things have changed significantly this year— freight rates have been on a wild ride. To help make sense of it all, we turned to our friends at McQuilling Services, a U.S.-based shipping consultancy that tracks and forecasts the tanker market. The big picture: The jump in tanker rates, especially for VLCCs, isn't due to any single disruption. Instead, it's driven by a combination of stronger demand for long-haul crude shipments and a sharp drop in available vessels, with many contributing factors that have sent rates through the roof — and relief is not expected anytime soon. This is our first in a new series looking at freight rates.
Understanding Freight Rates
Before getting too far into the details, it’s worth explaining how tanker freight rates are measured. Shipping costs can be expressed in dollars per voyage or in Worldscale (WS) points, an industry-standard system that measures freight rates relative to a benchmark for a specific route. Worldscale 100 (WS100) represents the published benchmark freight rate for a route, while quotes above or below 100, referred to as “spot rates,” indicate a premium or discount to that benchmark.
For example, if the published Worldscale benchmark rate is $20 per metric ton (MT):
WS100 = $20/MT (100% of benchmark)
WS150 = $30/MT (150% of benchmark)
WS75 = $15/MT (75% of benchmark)
(Note: VLCC is mostly quoted in dollars and Aframax rates are commonly quoted in WS. Though lump-sum pricing is also used on some routes. Spot rates can then be distilled further to time charter equivalent (TCE) figures, which standardizes how much money a vessel earns per day after accounting for voyage-related costs, such as fuel, port charges, and canal fees for both laden and ballast legs.)
The cost of a VLCC voyage from the Gulf Coast to Asia (red line and right axis in Figure 1 below) reached its highest point on record in early October, and most of that move has happened in just the last few weeks.
Prior to the start of the War in Iran earlier this year, the voyage cost typically ranged between $8 million and $14 million. However, once the conflict began and the Strait of Hormuz closed, the range of reasonable freight rates became a thing of the past.
VLCC costs doubled from $15 million the last week of February to nearly $30 million the first week of March, setting the first of many new record highs. From March through August, voyage costs generally ranged between about $18 million and $25 million, with some cooling off in June before momentum picked back up. In early October, the cost skyrocketed to more than $80 million. (That works out to roughly $40/bbl, compared with a historical norm of $4-$5/bbl.) The nearly $30 million voyage cost that seemed extraordinary in March — more than double the upper end of the prewar range — now looks modest. Rates have since eased off the record, with the VLCC voyage at $65.39 million as of October 19 — still nearly five times the top of the prewar range. The Aframax voyage from the USGC to Europe (blue line and left axis) has been choppier this year, but it reached WS1,000 on October 6, about 6X the year-ago rate, before easing to WS648.89 by October 19, 2026.
