Strait of Hormuz Remains Quiet Amid Ongoing Tensions
Limited Shipping Activity in the Strait
Since the two-week ceasefire between the United States and Iran was initiated, only 10 vessels have successfully navigated the Strait of Hormuz, as per maritime tracking reports. This crucial waterway, which typically facilitates approximately 20% of the global crude oil and liquefied natural gas trade, is experiencing an unprecedented lull, raising alarms about potential energy supply disruptions.
The ceasefire, declared on Wednesday, was intended to reopen the 167-kilometre strait for shipping activities. However, persistent tensions, statements from Iran’s Revolutionary Guards (IRGC), and ongoing Israeli military actions in Lebanon have led shipping companies to exercise extreme caution. Data from Kpler indicates that merely four tankers and six bulk carriers have traversed the strait since the ceasefire began, with only one tanker, the Gabon-flagged 'MSG' carrying around 7,000 tonnes of Emirati fuel oil, not associated with Iran, as it made its way to India.
Most of the limited maritime traffic consists of vessels either departing from or arriving in Iran, or those linked to nations allied with Tehran. Experts in shipping have reported that activity in the past week has plummeted to nearly 90% below typical levels, predominantly driven by Iranian trade. Richard Meade, editor-in-chief of Lloyd’s List, remarked that the Strait remains as open or closed as it was prior to the ceasefire announcement. Analysts from Kpler predict that daily ship passages will likely remain between 10 to 15, even if the truce holds.
Vessels Remain Stranded
Over 800 ships, along with thousands of crew members, are currently stranded on either side of the strait since the conflict escalated on February 28. According to Kpler data, around 172 million barrels of crude oil and refined products are being held on 187 tankers in the vicinity.
Major shipping companies are still hesitant to resume operations. The German shipping giant Hapag-Lloyd has explicitly stated that it will not restart its services on this route for the time being. Experts in shipping safety have advised against leaving the Gulf without clear coordination between the US and Iran.
Iran Implements New Passage Regulations
On Thursday, Iran introduced alternative routes through the strait, citing the dangers posed by sea mines in the primary shipping channel. The IRGC has instructed vessels to navigate paths closer to Iran’s Larak Island and mandated that all transits be coordinated with the Iranian navy. Reports suggest that some ships are being asked to pay fees for safe passage, with speculation that Iran may charge one dollar per barrel of oil, potentially in cryptocurrency.
Global Energy Market Impact
The International Energy Agency has characterized the disruptions caused by the conflict as the most significant supply shock the global oil market has ever encountered. With numerous ships immobilized and regular traffic yet to resume, energy prices remain under strain, and many nations are concerned about potential long-term supply shortages.
Currently, the world’s most critical oil chokepoint is functioning at a fraction of its usual capacity. Until both parties can provide clear safety assurances and the ceasefire proves to be stable, major shipping companies are likely to keep their vessels at bay, resulting in a largely stagnant Strait of Hormuz.