The Breakwave Tanker Shipping ETF (BWET), which tracks the price of oil shipping rather than crude oil prices themselves, has surged approximately 3,600% year-to-date as of September 11 according to Morningstar data, making it the best-performing non-leveraged fund in the United States. This rally is driven by the U.S.-Iran conflict that has squeezed tanker traffic through the Strait of Hormuz, pushing Middle East oil tanker route rates up nearly 500% year-over-year. Compounding these geopolitical tensions are Houthi rebels backed by Iran taking control of Yemen’s Mocha port and drone attacks in Iraq targeting Saudi Arabia’s crucial East-West pipeline, creating additional shipping chokepoints. BWET holds exposure to fewer than ten futures contracts on tanker traffic with a 3.50% expense ratio, but remains vulnerable to a sharp reversal if diplomatic progress emerges.
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