Ministers of OPEC and non-OPEC participating countries in the Declaration of Cooperation said shipping and insurance costs have surged to unprecedented levels of over one-third of the commodity value, impeding the efficient movement of crude oil and products. The ministers met on the sidelines of the International Energy Forum ministerial meeting and the World Petroleum Congress in Riyadh.
According to the release on OPEC’s website, the ministers underlined the importance of safeguarding international maritime routes and stressed that the elevated costs are increasing and prolonging the burden on both producing and consuming countries, weighing on global economic growth. Interruptions to energy flows have further added to inflationary pressures on the global economy, Reuters reported.
The ministers said they will continue monitoring the situation and engage with governments, industry stakeholders and international organizations to improve global shipping conditions. The warning quantifies what tanker markets have been signalling for weeks: with supertanker voyages from the US Gulf to Asia costing around $80 million, freight and war-risk insurance are now a first-order component of the delivered oil price, not a rounding error.