Patrick Pouyanné, CEO of TotalEnergies SE, revealed that the cost of shipping a single cargo of oil through the Strait of Hormuz has surged to as much as $20 million. This drastic increase is primarily attributed to soaring insurance premiums and significantly higher supertanker fees as ongoing geopolitical tensions deter many shipowners from entering the contested waterway. Before the recent Iran war, the benchmark Middle East-to-China supertanker route, known as TD3, cost around $200,000 per day. However, by August 7, 2026, rates on this route approached $500,000 per day, reaching $498,000, according to the Baltic Exchange, with some bookings even higher at 560 worldscale points.
The heightened costs reflect the significant risks associated with transiting Hormuz, where vessels have sporadically come under attack. Insurance costs alone have leaped to about 5% of a ship's value, a five-fold increase from the early days of the Iran war. For a $100 million oil tanker, this translates to roughly $5 million in insurance. The scarcity of willing shipowners, particularly those not controlled by Middle Eastern producers or the secretive Sinokor Group, has led to a scarcity premium for those willing to load inside the Persian Gulf. Clarksons Securities analysts noted that owners willing to load inside Hormuz are earning a "scarcity premium," while rates for ships loading in the Gulf of Oman for Asia are lower, at about $147,000 a day.
Pouyanné emphasized that paying a toll, even to an unspecified authority, is preferable to the Strait's closure, highlighting the precedent set by the Panama and Suez canals. He made these remarks at the Semafor World Economy Conference in April 2026, stating that the industry would rather pay to maintain market liquidity than face the economic fallout of prolonged disruptions. He warned that if blockades persist beyond three months, the world faces severe supply problems, particularly for jet fuel, diesel, and fertilizer, which he deemed an "almost system risk." As of August 2026, many tankers are employing tactics like turning off transponders to navigate the region, indicating the extreme measures being taken to manage risk and maintain supply chains.
While industry leaders like Pouyanné advocate for a structured toll system to ensure continuous flow and market liquidity, eight of the world's largest shipping industry associations have urged the United Nations and the International Maritime Organization to oppose compulsory tolls. These groups, in a joint letter dated August 3, 2026, warned that such fees could undermine international legal frameworks for navigation through straits and set a dangerous precedent for other global chokepoints. This divergence highlights the complex challenge of balancing security, cost, and international shipping norms in the volatile Strait of Hormuz.
