REUTERS, Singapore

The costs of chartering tankers to move oil from the Middle East to Asia have climbed and ship bookings have slowed as the Israel-Iran conflict fuels worries of potential disruptions, industry sources told Reuters on Monday.

The global benchmark rate for a very large crude carrier (VLCC) moving oil from the Middle East Gulf (MEG) to Japan, known as TD3, rose over 20 percent on Friday after the tensions broke out, according to LSEG data.

On Monday, the MEG-Japan rate for crude held steady at about W55 on the Worldscale industry measure, according to a shipbroker.

However, further gains in freight rates were limited as traders, shipbrokers and charterers take a wait-and-watch stance even as market participants said they did not expect the Strait of Hormuz, a key shipping passage, to be shut.

“Fixing on Friday from the region all but came to a standstill. Physical marks may therefore not be indicative. Ships inside the gulf are still looking for outbound charters,” said Anoop Singh, global head of shipping research at Oil Brokerage.

“But the situation remains dynamic, and we expect to hear more on market open today,” said Singh.

“We have noted a minor increase in freight rates so far, but expect them to rise further as the week progresses,” according to Sentosa Shipbrokers.

Emril Jamil, senior analyst for crude and fuel oil at LSEG Oil Research, said freight rates will depend on any continued escalation and potential action by Iran on the Strait of Hormuz.