Oil Freight Hits $20 a Barrel Versus $3 Last Year, Adding $40 Million to Every Supertanker Cargo as Brent Trades at $107.86

Freight, not crude, is the cost line that moved most this autumn. Goldman Sachs commodity analysts said in a note carried by Bloomberg that the average global cost to ship oil has reached about $20 per barrel, up from $3 per barrel a year ago. On Middle East routes the figure is about $35 per barrel, according to OilPrice.com's summary of the note on Wednesday.

Brent futures settled at $108.79 per barrel on Tuesday's ICE close, down 76 cents, after touching a five-month high of $111.99, per a Reuters market report. In Wednesday morning trading, Trading Economics showed Brent at $107.86 per barrel, down 0.85%. WTI traded at $97.08 per barrel on the same page, after the expiring November contract settled at $101.79 on Tuesday. These are pre-market futures quotes, not settled prices.

Where the $20 Comes From

Goldman breaks the increase into parts. A war-risk premium for the Strait of Hormuz adds $7 per barrel. Higher bunker fuel costs add $4, and ship-to-ship transfers in the Gulf of Oman add another $4.

Those three items total $15 of the $20 average, which implies about $5 of conventional freight. That subtraction is ours, not a Goldman figure. Supertanker rates topped $1.4 million per day on the Gulf to East Asia route in early October, a record, per the same report.

Aframax and Suezmax rates also rose, driven by the supertanker shortage. Goldman wrote that "higher freight rates for longer pose some upside risk to our Brent forecast." The note also cites intensified shipping attacks, infrastructure damage and a stickier geopolitical risk premium.

What It Means Per Cargo

A very large crude carrier loads about 2 million barrels. At $20 per barrel, freight costs $40 million per cargo, against $6 million at last year's $3. On Middle East routes at $35 per barrel, the freight bill reaches $70 million per cargo.

Freight now equals 18.4% of Tuesday's $108.79 Brent settle. A $35 Middle East freight rate equals 32% of that price. A refiner buying Gulf crude for delivery to East Asia therefore faces roughly $143.79 per barrel before port costs, using Brent as a rough reference.

Forecasters Disagree on the Floor

Goldman's baseline sees Brent at $90 per barrel at the end of 2026, which is $18.79 below Tuesday's settle. A roic.ai summary dated October 13 reported that Morgan Stanley lifted its Brent forecast to $105, citing a slower Middle East supply recovery that extends well into 2027. The $15 gap between the two banks is the story.

Goldman lists freight, shipping attacks and a stickier risk premium as upside risks to its $90 baseline, so its own note leans toward the higher end. Morgan Stanley said Wednesday that global fuel markets should stay tight until at least mid-2027, per OilPrice.com. Refinery maintenance is expected to peak at 3.4 million barrels per day in the second quarter of 2027, about 2.5 times the usual spring volume.

The IEA's October Oil Market Report likewise sees a diesel and gasoil crunch extending into mid-2027, as summarized by OilPrice.com. Inventory replenishment outside normal seasonal swings is unlikely before the second half of 2027. Diesel benchmarks eased from September highs above $200 per barrel but remain nearly double crude prices.

Archive Callback: Same Brent, Costlier Barrel

Oil Authority tracked Brent at $108.22 when Russia partly lifted its diesel export ban, covering under one day of Hormuz losses. We also reported a Brent settle of $109.55 ahead of WTI contract expiry. Brent sits within $1 of both levels today. With freight now taking $20 of each barrel, the same Brent print delivers a costlier barrel.

Russian Diesel and Today's Inventory Data

Russia will send its first diesel tanker to the US on Thursday, Deputy Prime Minister Alexander Novak said, carrying about 40,000 tons. At roughly 7.46 barrels per ton, that is about 298,000 barrels. Kpler's Michelle Brouhard estimated that the initial 300,000 tons Trump announced equals about 73,000 barrels per day over a month and would probably not move global prices much.

The EIA publishes its weekly petroleum status report today. The American Petroleum Institute reported a 4.93 million barrel drop in US crude stocks for the week ended October 16, per Trading Economics. A Reuters analyst poll expected a draw of about 800,000 barrels, so the API figure is roughly six times the consensus.