Traffic through the strategically vital shipping lane of the Hormuz Strait has begun to recover a week after the US and Iran signed an interim peace agreement.
However, an attack on a cargo ship off the coast of Oman on Thursday has reintroduced significant uncertainty to the already fragile situation along the waterway.
Shipping companies face a difficult choice: to risk transiting the strait or to delay shipments, potentially ceding market share to competitors willing to take on the risk.
Muscat, Oman, June 23: Several oil tankers and cargo ships were anchored off the Omani coast for days, unable to dock at Port Sultan Qaboos due to congestion.
A week after the US-Iran deal to reopen shipping through the Strait of Hormuz, maritime traffic is gradually increasing. Yet, a cargo ship attack on Thursday has cast fresh doubt on the fragile waterway's outlook, forcing the suspension of a UN seafarer evacuation plan and causing some tankers to turn back.
In the week following the ceasefire declaration (June 15-21), a total of 125 vessels transited the strait, marking the highest weekly traffic since the war broke out in late February. Major tankers are racing to transport a backlog of crude oil from the Gulf region before the 60-day ceasefire window closes.
Data from shipping analytics firm AXS Marine shows that 62 commercial vessels crossed the strait on June 24, a post-war high for single-day traffic, but this figure represents only 53% of the daily traffic seen during the same period last year.
Iran's Islamic Revolutionary Guard Corps announced on Wednesday that all transiting vessels must use only the northern route designated by Iran and comply with Iranian navigation directives. Just hours after this announcement, the Singapore-flagged Evergreen container ship 'Ever Boon' was struck by munitions on its starboard side near the Omani coast. A US official confirmed the attack was carried out by the IRGC, marking the first cargo ship attack since the ceasefire took effect.
The Strait of Hormuz, located in the Gulf between Oman and Iran, is one of the world's most critical energy transit chokepoints, with approximately 20% of global crude oil shipments passing through this narrow waterway.
Shipowners are currently forced to navigate between two conflicting sets of control rules: the northern route controlled by Iran, and the southern route in Omani waters. The conventional pre-war commercial shipping lane remains closed due to sea mines.
Tim Huxley, CEO of Mandarin Shipping, stated, "Shipping companies will remain extremely cautious about transiting the strait until clear, specific, and safe navigation guidelines are established."
Iran has warned that vessels not using the northern route and not coordinating their passage with Iranian authorities will face enforcement measures. The US and Oman support activating an independent southern route: with Oman issuing navigation guidance and the US Navy providing maritime security patrols.
Companies are caught in a dilemma: either risk choosing a route to transit, or delay shipments and watch competitors willing to take the risk capture market share.
Bruce Chen, a Singapore-based electronics manufacturer, had halted shipments to Middle Eastern clients for four months. While he has now resumed sending goods via the strait, he is only shipping in small, staggered batches to hedge against the risk of another blockade. His company has also arranged multiple alternative transport routes to mitigate operational risks if the waterway closes again.
Bandar Abbas, Iran, June 25: As military tensions eased in the Strait of Hormuz, locals unloaded goods from small boats along the port. Following the ceasefire and a memorandum of understanding that eased regional frictions, trade and maritime shipping between Iran and the southern coast of the Persian Gulf have gradually resumed.
Aristidis Alafouzos, CEO of Greece-based crude oil shipping firm Okeanis Eco Tankers Corp., believes the recent ship attack in the Gulf of Oman will not significantly alter the current trend of recovering traffic through the strait.
In an interview, he said, "There has been a significant increase in crude oil transport traffic recently, and this trend is likely to continue. A single incident is unlikely to disrupt the large-scale export of crude oil from Kuwait and the UAE via the Gulf. The only major exporter currently absent is Saudi Arabia, which is currently exporting almost no crude from its Persian Gulf coast, shipping all its oil from the Red Sea port of Yanbu instead."
Assessing the Strait's Future
Analysts warn that transit risks for the waterway remain high. Shipping companies urgently need clarity from regulators on safe navigation protocols, toll collection rules, and the applicability of international sanctions to different routes once they open.
Tim Huxley of Mandarin Shipping, which manages 50 vessels globally, stated that his company currently prohibits all its ships from transiting the Strait of Hormuz: "We still have no information on the extent of sea mine deployment in the area, making transit extremely high-risk. Various parties are still negotiating over transit rights and the control Iran and the US exert over the northern and southern routes. Most shipowners are waiting to see the outcome of these talks, unwilling to risk sending their vessels, cargo, and crew through prematurely."
"War risk insurance premiums for vessels and cargo transiting the strait remain prohibitively high. Shipping companies will not readily choose this route until clear, implementable safe navigation rules are in place."
Lin Hanshen, China Director at The Asia Group, highlighted the severe predicament companies face: "Corporate boards are no longer primarily concerned with the safety of cargo transport, but with whether they can obtain sufficient insurance coverage. The war risk premium for a single voyage has skyrocketed from 0.05% of the hull's value to over 0.7%. This is no longer a normal risk premium; it's an extreme stress test on a company's business model."
"If a ship is seized, the loss isn't just the cargo. It also means losing client relationships, impacting future insurance renewals, and shaking management's confidence. Without guaranteed safe passage, even the fastest transport efficiency is meaningless."
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