Record Tanker Rates Leave Heavy Crude Stranded in the Americas

The Middle East crisis has driven tanker rates to all-time highs and created a shortage of vessels.

This oil logistics problem is now causing a ripple effect, tipping the heavy crude market in North and South America into oversupply—while Asia and Europe grapple with a shortage of heavy grades.

Canada is producing over 5 million barrels of crude daily, most of it heavy crude.

Some 4 million barrels daily of that goes south to U.S.

Venezuelan production has also moved higher after the U.S.

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Blends WTI Crude • 11 mins 95.26 +1.12 +1.19% Brent Crude • 11 mins 106.4 +0.66 +0.62% Murban Crude • 16 mins 110.6 -1.67 -1.49% Natural Gas • 11 mins 3.297 +0.014 +0.43% Heating Oil • 11 mins 4.961 +0.027 +0.54% Gasoline • 11 mins 3.251 +0.001 +0.03% Click Here for 150+ Global Oil Prices Gasoline • 11 mins 3.251 +0.001 +0.03% Heating Oil • 11 mins 4.961 +0.027 +0.54% WTI Midland • 4 hours 95.24 +0.42 +0.44% Opec Basket • 1 day 112.3 -1.73 -1.52% Indian Basket • 7 days 121.1 +3.47 +2.95% Click Here for 150+ Global Oil Prices What I Cover Irina Slav has been writing about global energy markets since 2007, covering the oil and gas industry, energy security, commodities, and the… Shipping costs have surged to $40 per barrel, making American heavy crude increasingly uneconomical for Asian and European refiners.

The global diesel crunch is set to persist, as tanker shortages prevent heavy crude from reaching markets where demand remains strong.

The Middle East crisis has driven tanker rates to all-time highs and created a shortage of vessels.

This oil logistics problem is now causing a ripple effect, tipping the heavy crude market in North and South America into oversupply—while Asia and Europe grapple with a shortage of heavy grades.

Canada is producing over 5 million barrels of crude daily, most of it heavy crude.

Some 4 million barrels daily of that goes south to U.S.

Venezuelan production has also moved higher after the U.S.

disposed of the country’s government and took control of the oil industry.

According to Reuters, a lot of this heavy crude is stuck at home because of the record freight costs that have dampened appetite, pressuring prices in Canada, Colombia, and Ecuador.

Gulf Coast, so it is not as vulnerable to freight rate developments.

Prices for Canadian, Colombia, and Ecuadorian heavy crude have all shed some $10 per barrel in recent weeks, the report said , citing Argus data.