An increasing number of vessels are voluntarily activating their location transponders, signaling passage through the Strait of Hormuz. This trend indicates a sustained recovery in confidence among shipowners and traders regarding navigating this critical chokepoint, as geopolitical tensions ease.
Vessel tracking data revealed seven tankers in the strait on Tuesday morning. Among them, two fully-laden non-Iranian supertankers were departing the Persian Gulf, while three product tankers were heading out to sea. Two Iranian-flagged Suezmax tankers were approaching from the opposite side of the strait.
Muyu Xu, a senior crude analyst at Kpler Ltd., noted that this shift "reflects some restored confidence among shipowners, with the market expecting Iran to refrain from attacking passing vessels." However, he cautioned that sustained, unimpeded safe passage through the waterway remains to be seen.
The recent U.S.-Iran interim agreement has paved the way for the resumption of traffic through the Strait of Hormuz, a situation now under intense scrutiny from financial markets. In recent days, millions of barrels of crude oil have been shipped out via this vital corridor connecting the Persian Gulf to global markets, and liquefied natural gas carriers have also entered the strait.
The marked improvement in conditions, coupled with ongoing U.S.-Iran talks in Switzerland aimed at a permanent peace agreement, has contributed to a significant drop in crude oil futures prices. On Tuesday, Brent crude prices fell below $77 per barrel. In comparison, prices were slightly under $73 before the outbreak of the Iran conflict, indicating that most of the war-related premium has been erased.
Shipping through the Strait of Hormuz had been nearly paralyzed since the conflict erupted in late February. The increased willingness of vessels to broadcast their positions now provides greater clarity for crude oil and shipping markets, as well as global investors, regarding traffic flow through the strait.
During peacetime, approximately 135 vessels transit this waterway daily, including energy carriers for crude oil, refined products, and LNG, alongside other cargo vessels like bulk carriers, container ships, and livestock carriers. Such vessels typically rely on the Automatic Identification System (AIS) to broadcast their positions in real-time. All tankers observed transiting the strait on Tuesday had their AIS activated.
Major insurers, financiers, and maritime law firms generally require vessels to operate AIS, relying on positional visibility as a prerequisite for underwriting trade and extending loans. Some large insurance providers explicitly mandate continuous transponder operation to provide shipping insurance coverage.
Among the observed vessels, the very large crude carrier (VLCC) Universal Glory entered the Strait of Hormuz from the Persian Gulf on Tuesday morning, carrying 2 million barrels of Saudi crude. The vessel was navigating the central lane of the strait, bound for South Korea. It was followed by two product tankers, a Norwegian-flagged vessel, and another VLCC sailing along the Omani coastline.
A day earlier, three VLCCs carrying Iranian crude had publicly signaled their transit. In the opposite direction, the Suezmax tankers Sarak and Sobar were entering the strait, having originated from waters near Pakistan.
On Monday, one non-Iranian VLCC and four LNG carriers entered the Persian Gulf with their AIS signals activated.
Despite the growing number of vessels signaling their voyages, some ships still choose to turn off their transponders for portions of their journey. Hours before the Universal Glory's transit, a VLCC laden with Saudi and Emirati crude and destined for Taiwan entered the strait before its signal disappeared. It reappeared several hours later in the Gulf of Oman.
At the time of writing, WTI crude futures were down 0.50% to $73.49 per barrel, while Brent crude futures were down 0.54% to $77.10 per barrel.
Regarding future oil price trends, Danske Bank forecasts an average Brent price of $80 per barrel for the remainder of 2026, rising further to $85 per barrel in 2027. The bank emphasized that even if a U.S.-Iran deal is reached and Strait of Hormuz shipping normalizes, prices are unlikely to fall back to the pre-conflict range of $60–$70 per barrel, as it will take months for Iran's oil production and exports to return to normal levels.
The bank also noted that the U.S. government's continued release of strategic petroleum reserves could impact near-term supply dynamics, suggesting that political considerations might lead the U.S. to maintain this policy ahead of the midterm elections in November.
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