VLCC freight rates ride a "roller coaster," but the "anchor" that determines the industry's direction has not loosened.

1. What Happened? From "Ceasefire Expectations" to "Navigation Woes," the Oil Tanker Market Experienced a Wild Rollercoaster

Recently, the narrative of the global oil tanker market has undergone a three-stage evolution: from "rising ceasefire expectations" to "agreement signing," and then to "navigation reversals and freight rate collapse." In just seven weeks, market sentiment completed a full cycle from extreme optimism to panic-driven decline.

Phase 1 (Early May to Mid-June): Ceasefire expectations continued to heat up, with the freight rate center rising steadily. In May, although the Strait of Hormuz remained effectively blockaded, as both the US and Iran released more and more signals of peace talks, the market began to trade ahead on the logic of "resumption of navigation + restocking." VLCC TCE on the Atlantic route remained at $90k–$100k per day, while the West Africa–China route (TD15) fluctuated around $100k per day. The core characteristic of this period was: although freight rates had fallen from the extreme highs of the early war, they were still far above historical averages, and the market was transitioning from "panic premium" to "rational revaluation."

Phase 2 (June 15 to June 22): Agreement signed, freight rates peaked instantly. On June 15, a US-Iran ceasefire memorandum of understanding was reached; on June 17, the two sides formally signed the memorandum, with the US pledging to immediately begin lifting the maritime blockade on Iran and complete it within 30 days, and Iran pledging that merchant shipping would resume immediately. On June 22, the US Treasury OFAC issued Iran Sanctions General License X, temporarily authorizing transactions related to the production, sale, transport, and insurance of Iranian crude oil and products, effective until August 21. Upon the news, VLCC freight rates exploded—Middle East route quotes briefly surged to WS 650–750, equivalent to $700,000–$820k per day, about three times the pre-conflict level. As of June 22, TD3C (Middle East–China) TCE reached $512k per day, up 574% year-on-year; TD15 (West Africa–China) reached $189k per day, up 203%; TD22 (US Gulf–China) reached $155k per day, up 258%. During the same period, Strait transit volume also recovered from less than one vessel per day before the agreement to seven vessels on June 22 (pre-war average about 19 vessels per day).

Phase 3 (June 23 to June 30): Navigation reversals, freight rates "cliff-like avalanche." However, the dawn of peace was fleeting. On June 23, the IMO launched a large-scale seafarer evacuation; on June 25, a container ship was attacked off the Omani coast; on June 26, Iran again attacked vessels in the Strait, calling the stability of the agreement framework into question. The US and Iran accused each other of violating the temporary ceasefire, and the situation re-entered a high-risk state. Freight rates took a sharp downturn—TD3C quickly fell from its peak of $512k per day, and as of the week ending June 26, the Middle East–China route was reported at $288k per day, down 27% week-on-week. Even more dramatically, on June 26 itself, the Baltic Exchange assessed TD3C daily earnings at $328k, a plunge of $107k from the previous day, a decline of about one-quarter. Actual transaction prices were even lower—trader Mercuria chartered a VLCC owned by Onassis at just $202k per day. Capital markets reacted in tandem: on June 26, China Merchants Ship touched the daily limit down, COSCO Shipping Energy fell 9.09%, and Nanjing Tanker fell 8.57%.

…