Trump’s Strait of Hormuz fee could double the cost of shipping
“I see this as a reason for shipowners to get less comfortable in the region, alongside the attacks.” — Neil Crosby, Head of Research at Sparta Commodities
- Expert: Neil Crosby (Head of Research, Sparta)
- Publication: The New York Times
- Market Focus: Crude Oil, Freight/Shipping, Strait of Hormuz
- Geographies: Middle East, Europe, Persian Gulf
In a recent analysis for The New York Times, Sparta’s Head of Research, Neil Crosby, flagged the commercial dilemma facing shipowners if Trump’s proposed 20% Hormuz transit fee goes ahead. The charge could take the cost of shipping crude from the Gulf to Europe from around $10/bbl to $26/bbl, adding upwards of $30 million to a single VLCC voyage. Crosby is sceptical the fee will actually be imposed, but warns that its mere threat, layered on top of the ongoing US-Iran attacks, is already making shipowners less comfortable operating in the region. Traders should watch whether owners start rerouting or refusing Hormuz transits altogether, tightening tonnage available for Gulf crude and widening freight-inclusive arbs.
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