Markets are closely watching the Strait of Hormuz after Iran said on Wednesday that it would reopen the waterway that carries which a fifth of the world's daily oil supply to ships as part of a two-week ceasefire with the US.
Iranian Foreign Minister Abbas Araghchi said safe passage through the strait would be possible by “co-ordination with Iran's armed forces and with due consideration of technical limitations”.
There have been early signs of ships crossing the strait, according to Marine Traffic data on Wednesday. The Greek-owned bulk carrier NJ Earth crossed the strait at 12.44pm UAE time, while the Liberia-flagged Daytona Beach transited at around 11am, it said on X.
The shipping industry is awaiting technical details from the US and from Iran on how to travel along the Strait of Hormuz safely, Jakob Larsen, chief safety and security officer at Bimco shipping association, said.
Leaving the Arabian Gulf “without prior co-ordination with the US and Iran would entail heightened risk and would not be advisable”, he said.
There is also a heightened “risk of navigational hazards like grounding or collisions,” if too many ships attempt to cross at once.
The reopening of the strait under a short-term ceasefire does not automatically mean immediate normalisation of shipping activity, said Ashish Sheth, chairman and managing director of India-based Sarjak Container Lines.
“A backlog built over several weeks, close to 40 days in some cases, cannot realistically be cleared in just 10 to 14 days. Clearing this will require sustained and stable conditions over a longer period,” he told The National.
Shipowners will remain cautious until things become clearer and movement decisions will depend on “risk assessment, insurance coverage, and confidence in the stability of the corridor, not just its availability”, he added.
In a post on Truth Social following the ceasefire, US President Donald Trump said America would be “helping with the traffic build-up” in the strait. “There will be lots of positive action. Big money will be made,” he said, without providing details about when vessels will begin passing through the waterway.
Container lines with ships stuck in the Gulf will be looking at this as a window of opportunity to get ships out but they will wait and see how the ceasefire develops before committing to sail into the Gulf on a more permanent basis, Simon Heaney, senior manager of container research at maritime consultancy Drewry, said.
For now, navies are not expected to escort merchant ships in the short term because of uncertainty on the ceasefire and the possibility of resumption of hostilities if negotiations fail, Mr Larson said.
“At a later stage, if the ceasefire firms up, escorting might become an option to provide a level of assurance to seafarers on transiting ships,” he added.
More than 172 million barrels of crude and refined products are spread across 187 laden tankers waiting to pass through the narrow strait between Iran and Oman, data from Kpler shows.
The crude has remained in the Arabian Gulf since the war broke out on February 28, with Tehran imposing a blockade on the strait and choking global supplies as the conflict raged. Shipments from some countries, including China and India, were able to transit the waterway after talks with Tehran.
Hormuz is vital to the global trade of crude, with supplies mainly from Gulf producers and Iraq reaching markets in Asia and Europe. About 40 per cent of the crude waiting to leave the Gulf is from Saudi Arabia, with other supplies from Iraq, the UAE, Kuwait and Iran, the latest Kpler data shows.
From March 1 through April 7, Kpler data showed 70 ships transited the strait carrying 87 million barrels of oil in total. “Crude accounted for the majority of both crossings and volume, with Iranian-origin cargoes dominating outbound crude movements,” it said.
On March 30, two ships owned by China's Cosco Shipping Lines sailed through the strait to Port Klang, Malaysia. Ships from India, China, Russia, Iraq and Pakistan were also able to pass.
However, two Qatari liquefied natural gas tankers aborted an attempted crossing this week, dashing hopes of the first LNG shipments out of the Gulf since the war began. The Marshall Islands-flagged Rasheeda and the Bahamian-flagged Al Daayen turned back on Monday, ship tracking platform Marine Traffic showed.
Kpler said a ceasefire has highlighted that the strait is both a pressure point and a bargaining mechanism, but it does not resolve Iran's call for compensation for the war. “A formalised toll corridor mediated by Oman offers a pragmatic workaround, replacing politically unworkable reparations with a revenue stream funded by global trade,” it said.
