Middle East – October 29, 2026 -- Spot tanker rates reached record highs in September as geopolitical disruption in the Strait of Hormuz and the Red Sea lengthened voyages and cut trade efficiency, according to a Teekay Tankers market update.
Hormuz shuttle trade ties up VLCC capacity
Middle East Gulf crude exports have recovered despite continuing attacks on ships. Several producers now run a dedicated fleet of VLCCs through the Strait of Hormuz to transfer crude ship-to-ship (STS) in the Gulf of Oman. The arrangement absorbs a large number of vessels and adds extended waiting times, which pushed VLCC spot rates to record levels.
Houthi attacks force Yanbu cargoes north via Suez and SUMED
Renewed Houthi attacks on Saudi Arabian shipping and oil infrastructure in the Red Sea have rerouted exports from the port of Yanbu. Cargoes now move north through the Suez Canal / SUMED pipeline rather than south via the Bab el-Mandeb Strait, which adds to voyage distances.
Asian refinery demand keeps Atlantic-to-Pacific arbitrage open
Strong Asian refinery demand holds the arbitrage for long-haul Atlantic-to-Pacific movements wide open, adding tanker tonne-mile demand. The growing Gulf shuttle / STS trade, the Red Sea diversions and Asian appetite for Atlantic barrels together drove the September rate spike.
Teekay Tankers expects rates to stay well supported into Q4-26
Geopolitical developments will remain the primary driver of tanker markets in the near term, and rate direction depends on how key geopolitical factors play out. Ongoing trade inefficiencies and longer voyage distances are expected to keep spot rates well supported into Q4-26, according to the update presented by Christian Waldegrave.