Crude oil freight rates remain volatile at high levels, with geopolitical premiums continuing to support the VLCC market.

⑴ According to data from the Shanghai Shipping Exchange, freight rates for China's imported VLCC transport market fluctuated at a high level this week. The CTFI composite index closed at 4,360.85 points, a slight increase of about 0.7% from the previous period, remaining at a relatively high level in recent years.⑵ The conflict between the US and Iran continues to escalate, with US forces launching a new round of airstrikes on Iranian military facilities, while Tehran retaliated against relevant targets in the Persian Gulf region. The number of vessels transiting the Strait of Hormuz has dramatically decreased, placing both major energy arteries at risk of simultaneous paralysis, and geopolitical premiums continue to flow into the oil shipping market.⑶ In terms of fundamentals, US commercial crude oil inventories decreased by about 1.69 million barrels to 410 million barrels last week, exports increased by nearly 460,000 barrels/day, and the four-week average supply of crude oil products increased slightly by about 0.3% year-on-year, with both supply and demand supporting freight rates.⑷ From a market sentiment perspective, there are no signs of easing tensions in the Middle East. Shipowners are strongly inclined to avoid risk on the Persian Gulf routes; if the Strait of Mandeb is subject to new blockades, more vessels may be forced to detour via the Cape of Good Hope, further extending effective transport distances and pushing VLCC rental rates higher.