Crude freight rose far enough this fortnight to draw a policy response. TD22 (US Gulf to China) stood 36.4% above the Baltic’s report of 2 October at $70.58m a voyage, and on Wednesday 14 October a US official said the administration was weighing relief for shadow-fleet tankers expressly to bring freight rates down. Two days later the President signed an order waiving the sanctions provisions of the Graham Act, including its shadow-fleet vessel regime. The cargo had already shown what the freight costs. Western Canada Select was assessed at about $74 a barrel on 8 October, Colombia’s Vasconia at about $84 and Ecuador’s Oriente at about $76, each down more than $10 a barrel to a six-week low, and none of them moved.
Dry bulk went the other way. The capesize spot market fell by more than a third as iron ore dropped below $90 a tonne, and Black Sea wheat loadings turned out to have had their worst September since 2017.
Wet Bulk
The anchor is TD3C (270,000 tonnes Middle East Gulf to China), which stood at WS1,281.25 in the Baltic’s report of 16 October against WS1,145 one week earlier. Both basins came off in the second week, with the Baltic describing TD22 as $8.75m lower on the week.
Reuters reported that heavy crude is piling up across North and South America because freight has stifled exports. US refineries have run at about 93.5% of capacity on a weekly average this year, the highest in 28 years, so the plants configured to take these barrels are already full, and the freight bill is the number a seller has to beat before a price concession means anything. Russia meets the same mechanism from the seller’s side, as Suezmax freight for Urals from the Black Sea to India reached a record $27m to $30m a one-way voyage, against about $19m in September.
What relief would free up looks small. Clarksons Research counts 1,010 oil tankers individually sanctioned, 17% of global tanker capacity, and Energy Aspects expects releasing them to add no meaningful mainstream fleet capacity overnight, since most of them have been trading actively for the past three months. Sentosa Ship Brokers’ Becky Smart told Splash that in practice relief is unlikely to add genuinely usable fleet capacity. On Reuters’ industry sources, EU and UK measures would continue to bind insurers whatever Washington decides.
The clean market finished the fortnight flat on a violent path. TC14 (US Gulf to UK Continent, 38,000 tonnes) fell to WS285 in the Baltic’s report of 9 October and recovered to WS386 last week, 2.5% below the early month. The IEA has global diesel exports about 700,000 barrels a day lower in September than a year earlier and expects the shortage to persist well into 2027.
Dry Bulk
The anchor is the Baltic’s BCI 182 5TC, which fell with the ore price. The Singapore November contract dropped as much as 0.8% to $89.75 a tonne on Thursday 15 October, the first trade below $90 since September 2024.Zhengxin Futures sees further downside in the ore price on weak peak-season steel demand, the Simandou supply ramp-up and falling freight, since cheaper carriage lands more tonnes into a market that does not want them.
The Australian route did not lead the fall. C5 (West Australia to Qingdao) opened at $14.425 a tonne on Friday 2 October, dipped to $13.95 at the start of the following week, recovered into the upper $14s by its end while the 5TC dropped, finishing at $11.70 on Friday 16 October. Panamax held up better, with the Pacific supported by Australian, Indonesian and North Pacific demand while the Atlantic weakened as tonnage built.
Grain is the better dry bulk read of the fortnight. Black Sea wheat loadings fell to 1.6m tonnes in September, 77.8% below the 7.3m tonnes of September 2025, on AXSMarine data compiled by Ursa. The crop is intact: the USDA has combined Russian and Ukrainian wheat production for 2026/27 at 114m tonnes, virtually unchanged, while combined exports are forecast to fall 10.6% to 55.5m tonnes. Grain freight on the diversion route from Giurgiulesti to Constanta is about $75 a tonne against $15 to $35 previously, and US corn was 33% harvested and soybeans 46% in early October, both behind their five-year averages, so the replacement supply is arriving late.
Russia is loading further north, with a record 1.4m tonnes of wheat through Ust-Luga and Vysotsk in September, but Splash notes the reroute has failed to prevent Russia’s overall wheat exports falling by more than 40% year on year. The northern haul is longer, which on our reading is sea time the Atlantic tonnage build has to absorb.
Macro and Regulatory
The waiver is the fortnight’s largest US sanctions action. On Friday 16 October the President signed the executive order “Implementing the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026”. Using the national-interest certification in the Act’s Section 115(b), it waives the sanctions provisions of Section 102(a), (d) and (e) and of Sections 103 to 111 and 117, with no expiry date, two days before they were due to take effect on Sunday 18 October. Section 102 includes the mandatory regime for foreign vessels moving Russian-origin energy in evasion of sanctions. Measures under the earlier executive orders issued under the Russia national emergency are unaffected.
Washington moved both ways inside the week. Treasury designated 22 vessels, 27 companies and six individuals tied to Iran’s oil trade on 9 October, removed two vessels from the SDN List the same day. The United Kingdom added 12 more tankers on 8 October, and the European Union went the other way from Washington on, blacklisting three individuals and nine companies over shipping Russian crude and products and illegal transfers at sea. One of the individuals is a Mumbai-based commercial ship manager. The conduct named across the EU package is insurance-related services, ship-to-ship transfers and AIS tampering, which reaches a commercial manager as readily as an owner.
Two dates remain open. Panama’s tenth daily Neopanamax booking slot took effect for booking dates, taking total daily transit capacity across both lock systems to 33, with the Panamax locks unchanged at 23. The US Section 301 port fee suspension lapses at 11:59pm Eastern on Monday 9 November, the scheduled fee is $80 per net ton for ships owned or operated by Chinese entities, and the US Trade Representative has published nothing with three weeks to run.
A Sanctions Clause Needs to Test the Insurer’s Position
Freight set the terms in each sector this fortnight, and each answered to a different authority. In crude, the price of the voyage was high enough that Washington moved to loosen sanctions on the ships that carry it. In capesize the price fell with the cargo, and an owner who had fixed period cover ahead of the fall was ahead of the market. In grain, the cost of reaching a buyer rose with every extra mile of the diversion. What links them for a charterer is the ship, because its status decides what the voyage can cost.
That status is moving on different tests in different capitals. The United States moved in both directions inside a week, London and Brussels kept designating, and Section 115 permits a waiver on a national-interest certification with no finding that the conduct has stopped, as Morgan Lewis and Baker McKenzie both read it. A vessel’s US status can therefore change while nothing changes aboard the ship. The weak point sits with the ship that has just been delisted.
Reuters’ industry sources are clear that EU and UK regulation would continue to bind insurers whatever Washington decides, and Becky Smart makes the matching point about counterparties, that major oil companies and most EU- or UK-aligned entities are highly unlikely to rush towards vessels that were sanctioned until five minutes ago. Such a vessel passes every list test at fixing, and the insurer or the counterparty can still decline her on her history.
Until next week,
The Voyager Portal Team