Saudi Arabia's Civil Aviation Authority issued a statement in the early morning of the 11th saying that King Khalid International Airport in the capital Riyadh was attacked on the 10th, killing 12 people and injuring 309 others.
US President Trump also made a statement after the attack on the Saudi capital airport on the 10th, but only stated that the US might join Saudi Arabia's crackdown on the Houthis, and there were no clear promises.
The Iranian conflict has reshaped the Middle East crude oil trade pattern, compounded by a severe shortage of fleet supply. Freight charges for oversized tankers have soared to the highest level in 60 years — the cost of transporting a single ship of crude oil from the US to China is as high as 80 million US dollars, exceeding the launch cost of a SpaceX Falcon 9 rocket.
According to media reports on October 9, this week's order for an oil tanker departing from the US was equivalent to 41 US dollars per barrel when converted to freight, while the average value for the same route last year was only 4.50 US dollars. This cost accounts for approximately 45% of the West Texas Intermediate crude oil futures price.
According to the CITIC Securities Research Report, oil exports from the Strait of Hormuz have returned to pre-war levels, and a large increase in pallets and a limited list of available ships have driven VLCC freight rates to continue to rise and spill over to Suezmax.
Saudi Arabia's expansion of water distribution continues to stimulate pallets. STS transit is currently the main delivery method. Non-traditional handling operations combined with shuttle tanker capacity limit the continuous loss of VLCC's effective capacity and cannot match the growing pallet. As the frequency of recent ship attacks increases and damaged ships are difficult to maintain, VLCC's effective capacity is further damaged, and VLCC freight rates may rise further.
Cracking price spreads are expected to remain high, refinery procurement intentions are still sufficient, energy supply is gradually shifting to a stable priority, and seasonal rigid demand is compounded by increased flight distance due to changes in trade flow, and transportation of refined oil products is expected to reach an inflection point.
Tanker leader valuations and profits are expected to reach record highs in the fourth quarter of 2026.
COSCO Marine (01138): According to the Big Motor Research Report, the spot equivalent rental (TCE) for very large tankers (VLCC) reached 800,000 to 1 million US dollars per day, 20 times the 10-year average, mainly due to a decrease in effective capacity due to geopolitical uncertainty, and the low level of global crude oil reserves before winter, making holders' willing to pay premiums to ensure oil supply, and ship damage continued to accumulate during the conflict. The bank expects that, assuming the Middle East peace agreement is sustainable, if the prices of crude oil and refined oil products fall, freight will first go through a period of normalization. However, based on strong demand for restocking, permanent damage to some conflict-related ships, and potential “compliant” transportation demand for Iranian oil exports, the upward cycle of freight rates may continue after short-term sentiment resets. The bank believes that current freight rates may be difficult to sustain, but the risk of upward profit is increasing, and investor sentiment should continue to be supported.