Ensuring a Supertanker Goes Through The Strait Of Hormuz Now Costs Tens Of Millions, Total CEO Says

TotalEnergies Chairman and Chief Executive Officer Patrick Pouyanne said getting a supertanker through the Strait of Hormuz now costs $20 million.

Pouyanne told Bloomberg that the company is buying barrels at between $50 and $60 in the Persian Gulf as producing countries are increasingly desperate to sell their stocks as shipping through the waterway continues to be practically nonexistent.

He went on to say that additional freight costs amount to $10 a barrel. And considering Brent crude was around $90 a barrel on Monday, margins for cargoes transported and sold could be substantial.

Some companies are daring to cross the waterway despite blockades imposed by both the U.S. and Iran. In this context, the U.S. military said last week it has helped the transport of over 660 million barrels of oil through the Strait of Hormuz despite Iran’s blockade over the past months, the Central Command said.

Concretely, U.S. Navy Captain Tim Hawkins, a spokesperson for the force, said it had assisted some 1,300 vessels sail through the waterway since early May. “Multiple routes remain free and open for commercial transit,” he added.

CNBC noted that, based on Centcom estimations, the force has helped the transport of some 7 million barrels per day. This is still considerably below pre-war levels, when about 20 million barrels made it through the waterway every day.

The remarks follow a recent report claiming that the U.S. military is carrying out missions to help vessels transit the strait despite Iran’s blockade.

Citing officials familiar with the matter, Axios detailed on Thursday that the strategy has managed to guarantee the shipping of about 10 millions of barrels a day.

Overall, between 15 and 20 tankers are entering and exiting the waterway at night through a channel along the coast of Oman.

U.S. forces are not only escorting the vessels, but also helping them pick up oil from countries in the region and then exit.

“We have been controlling the southern lane of the Strait of Hormuz for two months now. The Islamic Revolutionary Guard Corps can be a nuisance, but they don’t control the strait. We do,” an official told the outlet.

The military is using fighter jets to protect the vessels from potential missiles and drones launched from Iran, and made possible by a recent launch of strikes that weakened Tehran’s radar and maritime surveillance systems. Some ships, however, have been hit.