Is Hormuz Open or Closed? Shiptracking Data Reveals True Picture

Why It Matters

The bottleneck threatens the flow of roughly 20% of world oil and LNG, potentially driving up energy prices and disrupting supply chains worldwide. Elevated insurance costs and fees also raise shipping expenses, affecting downstream markets.

Key Takeaways

• Only seven vessels transited Hormuz in 24 hours after Iran's announcement.
• Six were bulk carriers; three Chinese, three Greek, using Iran's toll‑booth route.
• Iran may charge $2 million per ship, shared with Oman.
• War‑risk insurance can rise to $7 million per tanker transit.
• Supply‑chain recovery could take at least three months despite traffic reopening.

Pulse Analysis

The Strait of Hormuz, a 21‑mile waterway linking the Persian Gulf with the Gulf of Oman, routinely carries about 20 % of global petroleum and liquefied natural gas shipments. Since the outbreak of hostilities between Iran, the United States and Israel in late February, daily transits have collapsed from over 130 vessels to a single‑digit figure. Satellite and AIS data confirm that only seven ships passed in the first day after Tehran announced a two‑week “safe passage” window, underscoring how quickly commercial traffic can evaporate when geopolitical risk spikes.

Beyond the physical blockage, Iran’s proposed $2 million per‑vessel fee—shared with Oman—adds a direct cost that rivals the cargo’s value for smaller tankers. Meanwhile, war‑risk insurers are quoting premiums up to 3 % of a vessel’s $200‑$300 million valuation, translating to roughly $7 million for a single transit. Such expense pressures ship owners to reroute around the Red Sea or delay voyages, inflating freight rates and compressing profit margins. The financial calculus now includes not only fuel and crew costs but also the probability of loss or damage in a contested corridor.

Energy analysts project that even if traffic normalizes tomorrow, the market will need at least three months for oil inventories to rebuild, especially in Asian refineries already running low. The prolonged scarcity is likely to keep Brent and WTI benchmarks elevated, while spot freight for ultra‑large crude carriers may surge as shippers scramble for the limited slots that do open. For downstream consumers and policymakers, the Hormuz impasse reinforces the strategic case for diversifying supply routes and building strategic petroleum reserves to buffer against future maritime disruptions.