Oil tanker daily charter rates surge past $1 million: S&P Global warns of a new normal of high oil prices as Middle East supply is "irreplaceable"

According to France 24, Jim Burkhard, Vice President of Oil Market Research and Energy Mobility at S&P Global, said on October 8 that high oil prices will be the "new normal" until crude oil flow through the Strait of Hormuz returns to normal. He stated bluntly, "The Middle East as a supply source is irreplaceable."

France 24's report pointed out that high energy prices are continuing to push up global inflation and stoking anger among voters everywhere; against the backdrop of more crude oil beginning to pass through the Strait of Hormuz and governments accelerating the release of emergency fuel stockpiles, "how long the energy crunch will last" remains uncertain.

Surge in charter rates and refining bottlenecks

The sharp rise on the transportation end is particularly striking. According to France 24 citing Burkhard, the daily charter rate for an oil tanker has soared from $60,000 to over $1 million, with the increase in transportation costs described as "stunning." Combined with refining capacity constraints — which he specifically noted "are not limited to the Middle East" — and damaged infrastructure, these are all seen by Burkhard as medium- to long-term challenges. Even if crude oil flow resumes, the decline in prices will continue to be constrained by processing and distribution links.

Less than five years, two crises

Burkhard sketched out the medium- to long-term context of this round of tensions in the interview: the world has experienced two energy crises in less than five years, and countries are maintaining energy security in "different ways" — some countries hope to expand domestic oil and gas production, while others seek to break free from fossil fuels. He stated bluntly, "the answers will not be uniform globally," and this "mixed response" depends on the resources and options each country can mobilize.

Structural exposure

What Burkhard described is not short-term volatility, but a renewed manifestation of deep structural rigidity in the global energy system: Middle East supply cannot be equivalently substituted in either refining or ocean transportation links, meaning the transmission chain formed by charter rates and refining bottlenecks will continue to allow the cost of tight supply to accumulate on the consumer end. Repeated energy crises have repeatedly confirmed the same fact: the structural rigidity of the fossil fuel system makes high oil prices a normal state that is difficult to escape quickly.