The Ledger Letter Finance Studio Advisors · November 1, 2026 |
The Barrel Costs $113. The Boat Costs $37.Clarksons put global supertanker earnings at an all time high of $805,000 a day. Moving crude from the US Gulf to China now costs $37.50 a barrel against $5 last year. The price everyone quotes is no longer the price anyone pays. |
The Breakdown Today’s disagreement: the crude screen is pricing a barrel near $113; the physical trade is paying close to a third more again to get it delivered. |
| 01 | The loud fact January Brent settled at $113.43 on Friday and December WTI at $104.12. October added 13.6% to Brent and 15.2% to WTI, a fourth straight monthly gain. |
| | 02 | The quiet fact Clarksons Research put global supertanker spot earnings at $805,000 a day in its week to October 9, which it called a fresh all time high for crude tankers. |
| | 03 | The anchor Shipping crude from the US Gulf to China now costs about $37.50 a barrel against $5 in 2025. Poten and Partners put freight near 27% of the delivered cost against about 3% in January. |
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| By the Numbers | Brent and WTI, Friday | $113.43 and $104.12 | | Global supertanker earnings | $805,000 a day, an all time high | | Gulf to Far East day rate | About $1.3 million, against $30,000 in January | | US Gulf to China freight | $37.50 a barrel, against $5 in 2025 | | Freight share of delivered crude | About 27%, against about 3% in January |
Crude settlements from Friday, October 30. Tanker earnings from Clarksons Research for the week to October 9. Day rates, the per barrel freight and the delivered share from Poten and Partners, whose share is measured against a Brent price near $120. |
When the Freight Stops Being a Rounding ErrorWhat the Screen Shows Clarksons Research summed up its own week in one line: crude tanker markets reached fresh all time highs. That is not the number anybody quoted. January Brent settled at $113.43 on Friday and December WTI at $104.12, and October added 13.6% and 15.2% to them. Those are the figures that run across a screen, sit in a commodity fund and get read out on the radio. They describe a barrel sitting in a tank. They do not describe a barrel arriving anywhere. What the Boat Costs Global supertanker spot earnings hit $805,000 a day. On the Gulf to Far East route Poten and Partners put the rate near $1.3 million a day. In early January that same route cost about $30,000 a day, so the year has multiplied it roughly forty three times. In voyage terms, Trafigura chartered a single supertanker from the US Gulf to China for about $76 million, against $7 million to $10 million before the war. Clarksons puts that route at $37.50 a barrel today against $5 in 2025, and Argus says freight premiums are adding tens of dollars a barrel to delivered crude. A glossary note, because this is where it gets slippery. The screen price is the barrel at the loading port. The delivered price is the barrel plus the trip. Those two numbers used to sit within a couple of dollars of each other. |
A barrel priced in dollars and shipped on dollar freight is two bets on the same currency, which is an older argument than this war. |
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Who Actually Pays It Refiners buy delivered, not screen. An Asian refiner paying Brent plus a freight bill near $37 is working from a crude cost close to $150. A US Gulf Coast refiner running domestic barrels down a pipeline pays almost none of that, and competes against the first one. That gap is why Exxon and Chevron briefly touched record highs on Friday on refining margins while the index had its worst day since June. It is also why the energy weight inside a broad index fund behaved nothing like the technology weight last week. For a portfolio the chain runs through products. Freight sits in the delivered cost of crude, and then again in the cargoes of diesel and gasoline that cross the same water. That is how it reaches a pump, a transport company and, a few months later, a core inflation print. A broad index fund holds all three of those on the wrong side. |
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What Settles It Our read is that the delivered premium is structural for as long as the strait stays dangerous, and that the screen price is now the smaller half of the story. Two checks, both published. Clarksons reports weekly on a Friday. Global supertanker earnings holding above $700,000 a day with Brent flat would say the premium is not easing. The US Gulf to China rate holding above $30 a barrel says the same thing. We would be wrong if earnings fall back under $400,000 a day while Brent holds near $110, which would mean the shipping squeeze is unwinding on its own. The midterms are Tuesday and the jobs report lands Friday. |
Everyone is watching the price of the oil. This quarter the money is in the price of the trip. |
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