Rates, ship values and trade routes have all reset since 28 February, with the change in routing looking more lasting than the risk premium.
Rates and ship values have moved to a new level
US and Israeli strikes on Iran on 28 February 2026 led Iran to close the Strait of Hormuz, which previously carried approximately 20 million barrels of oil per day, or around one fifth of seaborne crude. VLCC earnings have risen from an average of approximately $58,500 per day in 2025 to near $230,000, while Suezmax and Aframax earnings have increased from approximately $58,000 and $48,000 to $179,000 and $100,000 per day. VLGC earnings on the Houston to Chiba route have also risen from $52,288 to $154,618 per day.
Ship values suggest owners see the shift as more than temporary. A five-year-old VLCC is now valued at $157 million, up from $120 million at the end of 2025, while a five-year-old Suezmax has risen from $80 million to $108 million. The five-year-old tanker price index is 29% higher than a year ago.
Routing, not volume, explains the strength
Clarksons expects seaborne crude exports to fall 5% in 2026 and Middle East production to fall 16%, yet tonne mile demand is still expected to grow 1.5%. The reason is longer routing. Only five vessels transited Hormuz on 25 August, against a ten-day average of 15, while ship-to-ship transfers outside the strait have restored flows to approximately 7 million barrels per day. Saudi barrels are also moving north to Sidi Kerir, with around half of August loadings sailing to Asia around the Cape of Good Hope.
Owners have responded with increased ordering, with 508 oil tankers contracted in the first eight months of 2026 against 340 in all of 2025. Almost none will deliver before 2028. For investors, the key distinction is between the risk premium and the structural impact: a Hormuz agreement could remove the former quickly, while longer voyages, a sanctioned fleet of more than 1,000 tankers and limited newbuilding deliveries should continue to support earnings and asset values into 2027.
Sources: Bloomberg, Clarksons Research, CNBC, Kpler & MB Shipbrokers
