Oil freight at $100,000 piles pressure on crude markets

Soaring shipping costs are piling pressure onto physical oil markets that are already being hit by uncertainty surrounding a cap on Russian crude prices and weak Chinese buying.

Earnings on the industry’s benchmark trade route breached $100,000 a day on Monday, the highest since early 2020 when Covid-19 caused a surge in tankers storing cargoes. With sanctions on Russia now forcing ships to take longer routes — drying up the pool of available vessels — oil companies and traders are having to pay ever-higher prices to transport cargoes. That’s adding to the cost of crude.