ON A “normal” day the Strait of Hormuz would generally see around 45 tankers transit the narrow chokepoint that last carried 14.4m barrels of crude daily.

These are not normal days.

In the past day we have seen one shadow fleet tanker loaded with sanctioned Iranian crude exit.

US Energy Secretary Chris Wright announced on Tuesday that one oil tanker had been safely escorted through the strait, thus ensuring oil continues to flow to global markets.

That tweet was swiftly deleted and it seems escorts are still some way off.

Even if it had happened, it would have done little to change the overall numbers.

Naval escorts are a work in progress on the US side and while we understand the EU is considering playing a support act, any operational plan is still at a very preliminary stage, regardless of the political promises being made.

Even if escorts were made at full capacity tomorrow, which they won’t be, the likely transit numbers would be in low single figures every few days.

Severe delays for tankers of all sizes passing through the strait in both directions is the best case scenario if the plan to reopen relies on naval protection.

Oil extended its drop and stocks rebounded on Tuesday after Donald Trump said the war with Iran would end “very soon”, although he indicated it would not be within the next week.

Meanwhile, Iran’s top security official warned that the strait would remain unsafe for global shipping.

“The Strait of Hormuz will either be a Strait of peace and prosperity for all or will be a Strait of defeat and suffering for warmongers,” Ali Larijani wrote in a post on social media platform X.

The financial markets are still pricing in a short-term disruption, but as we noted repeatedly over recent days, that will not be the case if the Iranians threaten shipping enough to convince enough owners and charterers to steer clear, for fear of endangering crew and losing their asset.

Trump has threatened to strike Iran “TWENTY TIMES HARDER than they have been hit thus far” if the country disrupts the flow of oil through the strait.

But right now there is very little flow to disrupt and time is running out.

As Saudi Aramco warned on Tuesday, the Middle East conflict is going to have “catastrophic consequences” for the oil market the longer it continues, as well as “drastic” effects on the global economy.

Regardless of how soon “very soon” ends up being, the consequences of this war are going to ripple through the global economy and supply chains for months to come.

The question now is how long and how severe those ripples will be. 

Richard Meade
Editor-in-chief, Lloyd’s List

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