Oil tanker disruption is accelerating changes in global trade routes as geopolitical tensions reshape energy logistics. The closure of the Strait of Hormuz has halted a critical share of crude exports, forcing vessels to reroute across longer and more complex pathways. This shift is reducing efficiency across shipping networks while increasing operational risk. Consequently, freight markets are becoming more volatile and costly for participants.
Tom Beney, Senior Vice President of Ocean Freight at StoneX, has extensive experience navigating tanker markets through periods of geopolitical disruption. His role overseeing global freight operations provides direct insight into how supply shocks translate into shipping decisions and risk allocation.
Key Themes from the Discussion
Loss of around 20 million barrels per day triggered immediate global tanker rerouting
Crude tanker rates spiked before easing, while product tanker demand surged due to fuel shortages
War risk clauses determine how financial costs are distributed between charterers and shipowners
Oil tanker rerouting is increasing volatility in freight markets as supply routes are rapidly restructured. The scale of disruption is clear as Beney explains "all of a sudden we stop 20 million barrels of oil coming out", highlighting the sudden loss of supply. Consequently, vessels moved toward regions such as West Africa, Brazil, and the United States, pushing freight rates higher in the short term. However, as reduced supply lowered overall transport demand, crude tanker rates began to ease while uncertainty remained elevated. This volatility complicates planning for traders and refiners managing both logistics and pricing risk.
Shipping Contracts Determine Risk Allocation Across Markets
Shipping contracts are shaping how financial risk is distributed across the oil trade during disruption. Beney notes that "we have what's called war risk clauses", which define responsibility for insurance, delays, and operational costs. When contracts are active, charterers typically absorb these costs, but shipowners without contracts face significant financial exposure. As a result, some operators may take greater risks to restore revenue flows under pressure. This uneven distribution of risk is influencing operational decisions and affecting supply continuity.
Fuel Shortages Drive Product Tanker Demand Higher
Fuel shortages are pushing product tanker demand higher as refined supply tightens across global markets. Beney highlights the severity by stating that "Europe is running out of jet fuel", signaling downstream pressure. As crude disruptions limit refinery output, demand for transporting diesel and jet fuel has surged significantly. Consequently, smaller tankers are being rerouted through constrained routes such as the Panama Canal, increasing congestion and costs. This demonstrates how crude supply disruption cascades through the broader energy system.
Frequently Asked Questions
Why are oil tankers being rerouted globally?
Oil tankers are being rerouted due to the closure of key routes like the Strait of Hormuz, forcing operators to find alternative supply paths.
Who pays for oil shipping disruption costs?
Costs depend on contract terms. Charterers typically pay when contracts are active, while shipowners bear losses when vessels are idle.
Why is product tanker demand increasing?
Product tanker demand is rising due to shortages of refined fuels such as diesel and jet fuel across global markets.
Make Market Insights Your Competitive Advantage
Access live prices, supply and demand data and actionable market commentary across commodities, securities, currencies and more. Sign up for StoneX Market Intelligence today and receive a 14-day trial.
--- Expert: Tom Beney, Senior Vice President of Ocean Freight at StoneX
Energy
The subsidiaries of StoneX Group Inc. provide financial products and services, including, but not limited to, physical commodities, securities, clearing, global payments, risk management, asset management, foreign exchange, and exchange-traded and over-the-counter derivatives. These financial products and services are offered in accordance with the applicable laws in the jurisdictions in which they are provided and are subject to specific terms, conditions, and restrictions contained in the terms of business applicable to each such offering. Not all products and services are available in all countries. The products and services offered by the StoneX Group of companies involve risk of loss and may not be suitable for all investors. Full Disclaimer. This content is not intended for residents of any particular country, and the information herein is not advice nor a recommendation to trade nor does it constitute an offer or solicitation to buy or sell any financial product or service, by any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. Please refer to the Regulatory Disclosure section for entity-specific disclosures. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of StoneX Group Inc. The information herein is provided for informational purposes only. This information is provided on an ‘as-is’ basis and may contain statements and opinions of the StoneX Group of companies as well as excerpts and/or information from public sources and third parties and no warranty, whether express or implied, is given as to its completeness or accuracy. Each company within the StoneX Group of companies (on its own behalf and on behalf of its directors, employees and agents) disclaims any and all liability as well as any third-party claim that may arise from the accuracy and/or completeness of the information detailed herein, as well as the use of or reliance on this information by the recipient, any member of its group or any third party.
Our market expertise, advanced platforms, global reach, culture of full transparency and commitment to our clients’ success all set us apart in the financial marketplace.
Reach
With access to 40+ derivatives exchanges, 180+ foreign exchange markets, nearly every global securities marketplace and numerous bi-lateral liquidity venues, StoneX’s digital network and deep relationships can take clients anywhere they want to go.
Transparency
As a publicly traded company meeting the highest standards of regulatory compliance in the markets we serve; our financials and record of accomplishment are matters of public record. StoneX’s commitment to “doing the right thing over the easy thing” sets us apart in the industry and helps us build respect, client trust and new partnerships.
Expertise
From our proprietary Market Intelligence platform, to “boots on the ground” expertise from award-winning traders and professionals, we connect our clients directly to actionable insights they can use to make more informed decisions and achieve their goals in the global markets.
