Black Sea Oil Tanker Insurance Premiums Jump to $2.5 Million

War risk insurance premiums for oil tankers in the Black Sea have jumped from around $200,000 to $2.5 million per vessel, according to Evgeny Semenov, Lukoil's commercial director in Bulgaria, as reported by OilPrice.

Semenov noted that the Burgas refinery has secured its crude supplies until early December, indicating arrangements that supported continued operations despite the rising cost of insurance for tankers operating in the region.

In September, London marine insurers expanded reporting requirements for high-risk areas in the Black Sea to cover the entire basin, raising the cost of coverage for tankers navigating its waters.

These premiums increase the cost of shipping crude through a corridor carrying a portion of oil exports near conflict zones, with energy markets monitoring the impact of additional costs on fuel prices in the European market, which relies on seaborne supplies.

What Do These Terms Mean?

War Risk Premiums: Amounts paid by a shipowner to an insurance company to cover the risks of attacks and military actions in high-risk areas.

Tanker: A vessel dedicated to transporting crude oil and its derivatives in bulk between ports and refineries.

Refinery: A facility that converts crude oil into products such as gasoline and diesel, and continues to operate as long as crude supplies are available.