Shipping costs soar as Russian fallout overpowers global fuel flows

The Russian invasion has exacerbated a tightening of energy markets, upending trade flows and forcing buyers to scour the world for alternative fuel supplies

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An initial surge in rates for hauling crude hasn’t been sustained, partly due to reduced demand from China, leading to some shipowners switching part of their fleet to haul fuels rather than oil, according to two tanker charterers.

Elizabeth Low | Bloomberg
The dislocation of global fuel markets after Russia’s invasion of Ukraine has boosted the cost of shipping products such as diesel by sea.

Rates to haul fuels such as gasoline and diesel, known in the industry as clean tanker freight, have more than doubled this year to the highest since April 2020, according to Baltic Exchange data. On one key route in Asia, ship owners are now earning over $49,000 a day transporting products from South Korea to the distribution hub of Singapore, compared with $98 a day prior to the war.

The Russian invasion has exacerbated a tightening of

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First Published: Jun 23 2022 | 8:47 AM IST

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