BWET ETF Surges 1,718% as Tanker Rates Spike

The Breakwave Tanker Shipping ETF (BWET) has climbed roughly 1,718% year-to-date, making it the top-performing U.S. fund this year. The Schwab US Dividend ETF (SCHD) has gained about 27% over the same period.

BWET’s surge followed a sharp rise in tanker freight futures after renewed kinetic activity in the Gulf region. Exchanges between the United States and Iran included missile and drone launches toward Kuwait. Traffic through the Strait of Hormuz, which carries about 20% of global oil shipments, fell and several vessels were delayed or held near the strait. Spot freight rates reached multiyear highs as operators raised prices for available capacity.

The ETF does not invest in shipping companies. BWET gains exposure by buying freight futures contracts with maturities of one to six months and a weighted average expiration between 60 and 90 days. About 90% of its contracts are tied to Very Large Crude Carriers (VLCCs) and the remainder to Suezmax vessels.

Assets under management in BWET rose to about $119 million. The fund has an expense ratio of 3.50%.

Shipping equities also advanced. A basket of 35 U.S. and European-listed shipping stocks rose about 68% year-to-date and roughly 82% over the past 12 months. Market participants attribute the gains to both the Gulf disruptions and ongoing effects from the Russia-Ukraine war, including attacks on shipping infrastructure that have raised logistics and insurance costs.

Technical indicators show BWET trading near its all-time high and above major moving averages and the Supertrend indicator. Chart analysis identifies a potential double-top with resistance around $483 and a neckline near $336. A sustained move above $483 would point to further upside toward about $500; failure to clear that level could lead to a pullback.

BWET’s returns are concentrated in a single, volatility-prone segment of the market. The fund’s exposure to short-dated freight futures and its relatively high expense ratio provide direct exposure to tanker rates rather than ownership of shipping companies.