Oil supertanker rates hit all-time high as Iran pledges to close the Strait of Hormuz

Oil supertanker costs in the Middle East climbed to their highest level on record as conflict between the U.S. and Iran disrupts shipping through the strategically vital Strait of Hormuz . Major marine war risk providers have started to scrap cover for vessels operating in the Persian Gulf as the fallout from a sudden security shock hobbles key shipping routes in the region. The benchmark freight rate for Very Large Crude Carriers — used to ship 2 million barrels of oil from the Middle East to China — hit an all-time high of $423,736 per day on Monday, data from LSEG showed. That marked an increase of more than 94% from Friday's close. Alongside a significant jump in oil and gas prices, the stratospheric rise in the cost of hauling crude oil follows the U.S. and Israeli attacks on Iran over the weekend. The expanding conflict has resulted in the effective halt of shipping traffic through the Strait of Hormuz — one of the world's most important oil choke points, located in the gulf between Oman and Iran. An Iranian Revolutionary Guards senior official said Monday that the Strait of Hormuz had been closed and warned any vessel attempting to pass through the waterway would be attacked, state media reported. The claim has since been disputed by the U.S. military's Central Command, CENTCOM, Fox News reported. "Charterers in the VLCC segment stepped back from the market and avoided securing vessels as multiple incidents have led to increased threat levels around the strait of Hormuz, despite the waterway not being officially closed," Sheel Bhattacharjee, head of freight pricing in Europe at Argus Media, told CNBC by email. Getty Images Oil producers in the Middle East have not yet announced a halt to any production or loading yet, and ports in the UAE, Oman and Kuwait remain operational, Bhattacharjee said, citing market sources. "But most shipowners were avoiding transits through the strait of Hormuz after insurers cancelled the war risk coverage for vessels in certain a...