The shipping activity in the Strait of Hormuz, the world's most critical energy transit chokepoint, is approaching a complete halt as U.S.-Iran tensions escalate and commercial vessels face successive attacks.
According to a report, Iranian attacks on tankers and escalating U.S. military action have brought commercial shipping through the Strait of Hormuz to a near standstill. Two vessels managed by Dynacom Tankers, part of Greek shipowner George Prokopiou's fleet, were attacked, serving as the latest signal prompting shipping firms and crews to further avoid this crucial waterway.
Concurrently, vessel-tracking data indicates that the daily transit volume of large tankers through the Strait of Hormuz has dropped from an average of about eight in early July to just approximately two. Crude export activities that previously relied on ship-to-ship (STS) transfers to bypass the strait have also slowed significantly.
Dynacom Tankers Targeted in Attacks, Hitting Shipping's 'Last Holdouts'
The attacked vessels reportedly include a very large crude carrier named Acheloos and a smaller fuel tanker. Dynacom Tankers confirmed that two of its managed ships were attacked near the strait.
One of the vessels, identified as the Malta-flagged Panamax tanker Kavomaleas, was reportedly struck by two munitions of unknown origin, causing a fire in the engine room and forcing the crew to abandon ship. The UK Maritime Trade Operations office stated the crew was rescued by a nearby tug, but the vessel remains adrift and on fire.
Dynacom was previously seen as one of the few major shipowners still attempting to maintain shipping through the Strait of Hormuz. With its vessels now also targeted, market concerns are growing that other owners' willingness to continue risking passage will decline further.
U.S. maritime authorities continue to warn that commercial vessels in the Persian Gulf, Strait of Hormuz, and Gulf of Oman face elevated risks, with threats from Iran including not only boarding and interception but also missile, armed drone, and unmanned surface vessel attacks.
From Bypassing the Strait to Slowing Transfers, Pressure Mounts on Alternate Routes
Following the disruption of shipping through the Strait of Hormuz, some energy traders previously attempted to maintain exports via ship-to-ship transfers outside the strait, avoiding the need for large tankers to directly traverse the most dangerous route.
However, recent analysis indicates this alternative method is also cooling noticeably. Satellite imagery from July 18 showed only one pair of tankers engaged in STS transfers in the Gulf of Oman, compared to three pairs a week earlier. Maritime sources noted only two or three observed transfer activities recently.
This suggests the issue is evolving from "whether vessels are willing to transit the Strait of Hormuz" to "whether energy exports can continue smoothly even when bypassing the strait."
The U.S. had previously assisted some vessels in maintaining energy flows through military escorts and related maritime operations. However, following a series of vessel attacks, some shipping companies have begun reassessing or even refusing U.S. military-led passage routes.
Shipping Data Nears 'Zero,' But Energy Flows Not Yet Fully Halted
It is important to note that the near-standstill of shipping in the Strait of Hormuz does not mean global energy supply has completely stopped.
Data indicates current crude flows remain at approximately 14 million barrels per day, roughly two-thirds of pre-conflict levels, including supplies moved via maritime transport and pipelines. However, vessel tracking is affected by factors like signal interference, leaving significant uncertainty about actual flows.
Previously, dozens of commercial vessels transited the Strait of Hormuz daily, making it one of the world's most vital energy transit corridors. With the sharp drop in large tanker transits, the risk to global energy markets has escalated from "short-term shipping delays" to "persistent supply disruption."
Particularly noteworthy is the spillover of risks from the strait area. On July 20, the Iran-backed Houthi group announced a maritime blockade against Saudi Arabia, threatening to impact the Red Sea and Bab el-Mandeb Strait—another crucial global energy and trade route.
Brent Crude Breaches $90 for First Time in Over a Month as Market Prices in 'Prolonged Blockade'
Against the backdrop of near-standstill shipping activity and rising attack frequency, the crude oil market is repricing the Strait of Hormuz crisis.
On July 20, Brent crude oil briefly rose above $90 per barrel, marking its first breach of that price level since mid-June. U.S. WTI crude prices also closed higher. Market fears are growing that if military conflict between the U.S. and Iran continues to escalate, the Strait of Hormuz's practical transit capacity could decline further, turning supply disruption from a short-term event into a persistent crisis.
Previously, the market had bet on diplomatic efforts and military escorts to restore passage through the strait. However, with ongoing U.S. airstrikes on Iran, Iran attacking commercial vessels, and shipowners reassessing U.S.-led passage plans, the energy market now faces a more difficult question: even if the strait is not formally closed in a legal sense, has commercial shipping become de facto inoperable?
Based on current vessel activity, the answer appears increasingly to be "yes."
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