To The Moon

As attacks attributed to Iran intensify, a growing number of empty supertankers are turning around and moving away from the Persian Gulf.

According to compiled tanker-tracking data, at least 10 very large crude carriers (VLCCs) and several Suezmax tankers have either stopped or reversed course in recent days as they approached Fujairah port in the United Arab Emirates.

Although other vessels are still heading into the region, the withdrawal of these supertankers is renewing concerns about whether oil can continue to move through the waterway, given that attacks occur almost daily around the Strait of Hormuz, with some strikes taking place even near Fujairah.

Ships typically call at Fujairah before proceeding into the Gulf of Oman or continuing on to the Persian Gulf. As a result, the number of vessels sailing toward Fujairah is also a broader gauge of tanker operators' willingness to enter waters near the Strait of Hormuz.

Large crude carriers can wait outside the Strait of Hormuz in offshore Fujairah and Omani waters, while shuttle tankers take on the riskier transits through the strait. Those shuttle vessels carry crude out and then transfer it to the larger tankers, which deliver it to buyers.

This system depends on a steady supply of receiving tankers. If empty VLCCs withdraw from the region on a large scale, it could slow crude shipments, and shuttle tankers would also be tied up for longer periods as a result.

It is particularly notable that tankers are still leaving even at a time when freight rates are soaring. A global shortage of tankers has pushed shipping costs to unusually high levels. Today, the cost of chartering a tanker to move oil from the United States to Asia is even higher than sending a rocket into space.