Pozsar Was Right Again: Shipping Costs Soar 82,000% Amid Global Supply Chain Chaos After Ukraine
24th June 2022
Several months ago, Credit Suisse strategist and former NY Fed “liquidity plumber” Zoltan Pozsar predicted that as a result of Russian commodity exports being shunned by western nations and/or distributors while greeted by eastern nations (such as India and China) would would find delight in the 30% discount to spot on Russian oil, shipping costs would soar as a result of the challenging – and expensive – realignment of global supply chains which would see legacy tanker flows be scrapped only to be resurrected in the form of much more expensive alternatives.
Well, Pozsar was right again because four months after the Russian invasion of Ukraine, the resulting dislocation of global fuel markets has lead to a surge in shipping costs of products such as diesel by sea.
On the other hand, those of us who own shipping stocks (ZIM, SBLK, GOGL) are making out like bandits.