Hormuz-related force majeure declarations could create unprecedented chaos
- Middle East Gulf facilities have been implicated by the Hormuz crisis, causing major commodity producers to halt production and declare force majeure with restarts set to take a while
- Off-takers of gulf-origin cargoes may face challenges from their downstream customers on force majeure claims, with continued Hormuz transits
- Bad actors could look to exploit the Hormuz crisis to get out of contractual obligations even if they might not be directly implicated
Disputes could arise on the back of Hormuz force majeures in the long term as buyers challenge sellers’ abilities, or lack thereof, to perform their contractual obligations
