US signals U-turn on naval convoys to restart Hormuz transits
- Trump announces naval escorts through Strait of Hormuz, reversing previous US Navy refusal to secure transits
- US Development Finance Corporation to provide political risk insurance and guarantees for the financial security of all Maritime Trade “at a very reasonable price”
- At least three Greek owners are actively discussing suezmax fixtures through the Strait of Hormuz with AIS switched off, Lloyd’s List understands
- Tanker transits through strait have largely halted since March 1, with about 8% of mainstream VLCCs stuck inside the Middle East Gulf
- A Greek-owned suezmax appears to have transited at night with no AIS
The US had ruled out naval protection for tankers transiting the Strait of Hormuz on Monday, according to industry officials. By Tuesday evening US President Donald Trump had reversed that call offering Navy escorts ‘as soon as possible’ and financial guarantees for maritime trade
US President Donald Trump signalled that the US navy was ready to offer security escorts for tankers transiting the Strait of Hormuz on Tuesday evening – less than 24 hours after Navy officials told shipping industry representatives that there was “no chance” of escorts happening any time soon.
In a social media post, Trump announced that he had ordered the US Development Finance Corporation to provide, “at a very reasonable price, political risk insurance and guarantees for the Financial Security of ALL Maritime Trade”.
He added that “if necessary, the United States Navy will begin escorting tankers through the Strait of Hormuz, as soon as possible”.
Following multiple requests from industry bodies, representatives of the US Navy had briefed senior industry figures on Monday evening to confirm that there would be no availability of naval escorts and no timeline for when such arrangements will be available, if at all.
Industry officials had no immediate visibility on Tuesday evening of when escorts would be commencing.
Tanker transits through the strait of Hormuz have largely halted since March 1, leaving around 8% of the mainstream VLCC fleet locked inside the Middle East Gulf and a growing queue of tankers unable to enter via the Strait.
However, at least three Greek tanker owners are actively discussing suezmax fixtures through the strait with the intention of transiting at night with AIS turned off, Lloyd’s List understands.
While it has primarily been smaller tankers that have transited the strait since Sunday, one Greek-owned suezmax made a northward voyage around midnight (UTC) on Monday.
Another Greek-owned suezmax was seen sailing from the Gulf of Oman into the Middle East Gulf on March 1 and is now anchored off Saudi Arabia in ballast. While the vessel has suffered GNSS interference while passing through the Strait of Hormuz, there is a 12-hour gap in transmission beginning when it was south of the strait.
Passages through the strait are increasingly challenging to ascertain given widespread GNSS interference and potential dark transits by vessels.
Many of those are expected to start loading shortly despite the security risks, but the market demand is now for tankers to enter the MEG in ballast to start loading and re-start oil transits as soon as possible.
There are 37 non-shadow fleet suezmaxes and VLCCs in ballast currently waiting south of Hormuz in the Gulf of Oman and Arabian Sea, with another five arriving in the region at the time of writing, according to Lloyd’s List Intelligence data.
Despite the lack of tanker transits, oil market prices continue to indicate that the current lack of fixtures is a short-lived disruption rather than an extended shortage in supply.
Brent opened at around $80 per barrel, well below the roughly $130 per barrel that would be expected if the market was pricing a full closure of the strait for an unknown duration and a disruption severe enough to trigger an oil shortage.
Stamatis Tsantanis, chairman and chief executive of Seanergy Maritime and United Maritime, said: “The insurers will continue coverage on ships that are already in the area, but they are denying coverage for ships that are willing to play pirates and enter the area and get high rates.
“There are certain shipowners in the world who say, ‘I’m going to do it.’ That’s always the case in these kinds of situations, where people take risks and potentially risk the lives of crew members and the ship itself,” said Tsantanis.
Excluding the Greek-owned suezmax, just four vessels over 10,000 transited the strait on Monday — three small bulk carriers and one shadow fleet asphalt tanker. One of the bulkers came from Iran’s Bandar Abbas port.
