Major oil companies worldwide are facing serious challenges due to the sharp increase in tanker transportation rates. According to recent reports, this rise in costs has led to billions of dollars in the recent quarterly financial results of these companies.
Cost Increases at Shell
Shell has reported in its quarterly report that tanker chartering costs have increased by $5.4 billion. This increase is due to the extraordinary rise in rates following the onset of tensions in the Middle East. This accounting adjustment relates to charter contracts for vessels linked to market indices that must be assessed at current rates. Since the beginning of this year, Shell's tanker chartering costs have risen by nearly $7.7 billion. However, Shell has emphasized that these assessments do not imply immediate cash costs.
Read more: Continental Oil Company Signs Contract for Services of 4 Offshore Drilling Rigs
Impact on Other Companies
Sinad Gorman, CFO of Shell, has stated that transportation rates between the Middle East and China are currently about ten times last year's levels. This increase in costs has harmed the profit margins of refineries, chemical industries, and crude oil trading. At the same time, Shell has reported that adjusted income in the third quarter reached $10.8 billion, more than double the figure from the previous year.
At TotalEnergies, Patrick Pouyanné, the CEO, announced that transportation costs have risen from about $2 to $3 per barrel to nearly $25. This increase in costs has put about $6 per barrel pressure on the company's liquid prices. TotalEnergies has somewhat shielded itself from these costs with its chartering strategy.
Eni has also pointed to rising transportation costs, stating that adjusted operating income from refining in the third quarter reached €730 million. However, these profits have been somewhat affected by high transportation costs and unfavorable crude oil differentials.
Market Status and Forecasts
Equinor has also reported on the direct impact of rising transportation costs, stating that the company faced an operational loss of $96 million in the third quarter. This loss has been severely limited due to damages from derivative positions in the transportation market. Equinor has also identified rising transportation rates as one of the main reasons for increased operational costs in the first nine months of 2026.
Oil companies that hoped for a reduction in transportation rates faced a positive market atmosphere at the recent Maritime CEO Forum in Monaco. Estimates indicate that VLCC revenues this month were 14 times their ten-year average, and analysts see no signs of selling in the market. Additionally, DHT Holdings CEO, Svein Moksheim Harfield, pointed to the aging fleet and believes this trend will help support the market.
Given the market outlook and rising demand, it seems that conditions for oil companies may not improve in the short term. Especially considering oil flows in the Middle East and strong demand from China, this market may face more challenges in the near future.
Read more: Trump Administration Turns Attention to Venezuelan Oil with Stop at Curacao
