Freight surge traps Americas heavy crude as Asia chases supply
An oversupply of heavy crude is building in North and South America while Brent trades above $100 a barrel, as tanker freight rates have surged in the wake of the United States-Iran war. Last week the cost to ship crude from the Americas to Asia on a very large crude carrier topped $80 million, about $40 a barrel, and the Gulf Coast to Europe route was estimated at about $46 million. United States refinery utilization this year has averaged its highest level in 28 years, limiting how much additional heavy crude the country can process.
Why it matters: It shows that in energy trade, freight and refining constraints rather than crude availability can determine where barrels move and at what price.