Strait of Hormuz $20m shipping costs force Gulf crude discounts
Getting oil through the Strait of Hormuz has gotten pricey: $20 million per supertanker.
That's pushed Middle Eastern producers to drop their prices, so their crude now sells for $50 to $60 a barrel, much lower than Brent crude's $90-plus.
It's all about staying competitive as shipping costs soar.
Patrick Pouyanne: crude $50-$60 per barrel
TotalEnergies CEO Patrick Pouyanne summed it up: "Crude oil is sold to you at $50, $60 per barrel, not the Brent price, because the producers are desperate to push their oil into the market."
Those discounts are keeping global prices stable, even though supplies for gasoline and diesel are tight thanks to things like Ukrainian strikes on Russian refineries.
To cut reliance on Hormuz, TotalEnergies is eyeing a proposed Baghdad-to-Syria pipeline and expanding pipeline infrastructure in the UAE.
Meanwhile, Iran has blacklisted 45 tankers in the Strait, adding even more tension to the Strait of Hormuz, which accounted for about a fifth of global oil flows before the Iran war.