Oil
Record tanker rates leave American heavy crude stranded
Surging shipping costs and vessel shortages are stranding heavy crude in the Americas while constraining refinery supplies in Europe and Asia.
Key points
- Tanker freight rates have surged to record highs due to Middle Eastern shipping disruptions.
- American heavy crude prices have dropped as high transport costs dampen international demand.
- The logistics bottleneck is expected to prolong the global diesel crunch by restricting heavy crude access.
What happened
Global shipping costs have escalated significantly, reaching up to $40 per barrel for routes from the Americas to Asia, according to reporting from OilPrice.com. The surge is driven by vessel shortages and ongoing security issues in the Middle East, where producers increasingly rely on shuttle tankers and ship-to-ship transfers outside the Strait of Hormuz.
As a result, supertanker rates and transit expenses have multiplied. Shipping from the U.S. Gulf Coast to Europe has climbed to $24.50 per barrel, compared to around $4 per barrel before the conflict. These prohibitive transport expenses have discouraged refiners in Europe and Asia from purchasing heavy crude grades from producers in Canada, Colombia, and Ecuador.
Why it matters
The logistics bottleneck has created an oversupply of heavy crude in North and South America, depressing regional prices by about $10 per barrel in recent weeks, as cited by Argus data. Western Canadian Select traded around $79.50 per barrel recently, while Ecuador's Oriente and Colombia's Vasconia saw fluctuations.
At the same time, refiners in importing regions face a shortage of heavy grades, which yield higher volumes of diesel than lighter crude. This mismatch exacerbates a persistent global diesel crunch. According to US EIA data from October 2026, the US Gulf Coast diesel spot price stood at $4.565 per gallon, reflecting high product value amid constrained processing inputs.
What comes next
Market analysts note that until vessel availability recovers and transport bottlenecks ease, freight costs are likely to remain elevated. This dynamic will continue to restrict cross-Atlantic shipments, leaving heavy crude barrels trapped in the Americas and sustaining upward pressure on refined product prices worldwide.
Original reporting
This article draws on the following reports. Read them in full on the publishers’ sites.
Context from CEII
Crude benchmarks move budgets, currencies and inflation in producer and importer countries alike. For economies such as Nigeria, where fuels dominate exports, production and refining decisions move the whole economy.
9.5% of world merchandise exports were fuels in 2025Written by the CEII Desk, the Centre’s automated newsroom, from the reporting credited above and CEII’s own data. Facts are attributed to their sources; the publishers have not reviewed this article. Spotted an error? Tell our editors.
