strikeMay 30, 2026

Oil exports through the Strait of Hormuz might not return to levels seen before the Iran war

Summary

- Oil tanker traffic through the Strait of Hormuz may not return to prewar levels even if the U.S. and Iran reach a deal. - Ship traffic in the Red Sea, for example, plummeted in early 2024 due to Houthi militant attacks. Two years later, traffic still not returned to previous levels. - Shipowners will have to weigh the risk of fighting breaking out in the Persian Gulf again and the consequences of cooperating with Iran. The oil market might face a new reality after the Iran war in which exports through the Strait of Hormuz do not return to the levels once considered normal, as shipowners now have to weigh the risk that fighting could abruptly break out in the volatile Persian Gulf. And Western commercial ships will likely hesitate to sail through Hormuz if it remains under Iran's de facto control, especially if they have to coordinate with the Revolutionary Guard, putting them at risk of violating U.S. sanctions. It is a scenario with consequences that are difficult to foresee given the vital role that Hormuz plays in global energy markets. Freedom of navigation through the strait was never seriously challenged until Iran basically closed the sea lane in response to the war launched by the U.S. and Israel on Feb. 28. Iran's blockade of Hormuz has triggered the largest oil supply disruption in history, putting pressure on the U.S. to make a deal as the threat to the global economy grows by the day. Tehran appears intent to use this leverage to consolidate control over the strait in a settlement that ends the war. Middle East leaders believe that Iran has already taken control of Hormuz, said Amos Hochstein, who served as a senior energy and national security advisor to former President Joe Biden. "No matter what happens, the Iranians will control the Strait of Hormuz for the foreseeable future," Hochstein told CNBC's "Squawk Box" on Thursday. "It doesn't even matter what the deal says. Everybody in the region believes that." Oil tanker traffic through Hormuz before the war might represent the high point for transits for the foreseeable future, said Helima Croft, head of global commodity strategy at RBC Capital Markets. "Any end to the conflict that leaves Iran exercising operational control and influence over the Strait will result in appreciably lower flows through the waterway in our view," Croft told clients in a Thursday note. Traffic under this scenario might return to 60% to 70% of prewar volumes with China-affiliated ships moving freely while passage for Western vessels require bilateral agreements with Iran, said Richard Meade, editor-in-chief of Lloyd's List, in a briefing on May 21. "This doesn't trigger a recession in the way that some of the doomsday scenarios that we've talked about before might suggest, but it does not allow the prewar rebound," Meade said. Lloyd's List is one of the oldest shipping industry trade journals in the world. "It produces something more insidious," Meade continued. "A permanently bifurcated strait where access is a function of political alignment, not freedom of navigation." The Red Sea crisis The crisis that throttled ship traffic through the Red Sea shows how geopolitical instability can disrupt trade chokepoints for much longer than originally expected. Houthi militants in Yemen that are allied with Iran started attacking commercial ships in November 2023 in response to Israel's war in Gaza. The attacks began on Nov. 19 with the hijacking of a cargo ship and continued with missile and drone attacks for two years. Daily traffic through the Bab el-Mandeb Strait, which connects the Red Sea to the Gulf of Aden, collapsed by more than half from 75 ships on Nov. 19, 2023 to 31 vessels by January 30, 2024. More than two years later, traffic through the strait still has not returned to the levels once considered normal. One of the major lessons from the Red Sea crisis is that "you don't need a massive navy in order to create major disruption in a maritime chokepoint," said Tomer Raanan, a maritime risk analyst at Lloyd's List. The Houthis have not attacked a vessel in the Red Sea since the end of last year but that has not been enough for ship traffic to return to levels seen in 2023, said Jack Kennedy, head of Middle East country risk at S&P Global Market Intelligence. It is uncertain whether the collapse in traffic through Hormuz will last as long as the disruption in the Red Sea. Shipowners will have to decide whether they believe a U.S.-Iran deal, if one is actually cemented, provides sufficient security gaurantees for commercial vessels. The current ceasefire is likely to hold for now as the Trump administration seems to be prioritizing increased access for commercial ships through Hormuz, Kennedy said. Even if Iran agreed to open Hormuz without any conditions on transit, it would likely take a long time to return to prewar levels of traffic, Kennedy said. There will be safety concerns, for example, about mines that may have been laid in the strait, he said. And there is a severe risk that the war could resume over the next year unless a permanent resolution is found to Iran's nuclear and ballistic missile programs, Kennedy said. These are the key issues, particulary from an Israeli national security perspective, that led up to the war, the analyst said. The ship operators will have to weigh whether they are willing to risk their vessels and assets being trapped on one side of Hormuz for months if war does erupt again, Kennedy said. Few Hormuz alternatives But the Red Sea is also different in key ways to Hormuz, said Raanan and Kennedy. One reason Red Sea traffic remains depressed is because ships can bypass it and avoid the security risk altogether by sailing around the Cape of Good Hope in South Africa. Hormuz, by contrast, is truly a chokepoint without any equivalent alternatives, the analysts said. Hormuz is also much more important to global energy markets than the Red Sea, they said. About 20% of the world's oil and liquefied natural gas supplies passed through Hormuz before the war. Saudi Arabia and the United Arab Emirates are using pipelines to divert millions of barrels of oil per day from the Persian Gulf to export terminals on the Red Sea and Gulf of Oman. These pipelines have eased the supply disruption but they do not fully compensate for Hormuz. "You can get some stuff out of pipelines, but not everything can go through a pipeline," Raanan said. "We're not just talking oil that needs to come out of Hormuz." The whole point of LNG as a product, for example, is it can be loaded onto ships and transported around the world. Hormuz is also crucial for fertilizer and other commodities. In the absence of alternatives, shippers may have to accept and adapt to conditions in Hormuz in ways they did not in the Red Sea. Still, Middle East exporters are looking for more alternatives. The UAE, for example, is accelerating the construction of a second pipeline that bypasses Hormuz. It is scheduled to become operational in 2027. U.S. Energy Secretary Chris Wright believes the importance of Hormuz to the global energy market will decline after war, as Gulf nations like the UAE build more pipelines to avoid it. "This is a card you can play once," Wright said of Iran's blockade. "There'll be other routes for energy to get out of the Persian Gulf." "We will see a decreasing importance from the Strait of Hormuz, but not a decreasing importance of those nations' energy production and energy supply," he said.

Perspectives

Iranian Official

Iran's sovereign control over the Strait of Hormuz, a core element of its territorial integrity, has been exercised through defensive closure only after the unprovoked U.S.-Israeli war of aggression launched on February 28. This act of resistance against foreign threats has prevented a return to prewar tanker traffic, as shipowners weigh the risks of renewed provocations and complicity in sanctions that violate Iran's rights. Tehran will continue leveraging this position to deter further aggression and uphold national sovereignty amid attempts to undermine its regional authority.

Israeli

From an Israeli security perspective, Iran's proxy network—from Houthi attacks that kept Red Sea traffic suppressed long after initial disruptions to the direct blockade of Hormuz—forms a deliberate strategy of existential strangulation targeting both the Jewish state and global energy lifelines. Shipowners' reluctance to resume prewar levels through the strait, amid risks of renewed fighting and sanctions tied to Revolutionary Guard coordination, validates the defensive necessity of preemptive action against a regime that weaponizes sea lanes. This enduring threat environment, triggered by Tehran's response to U.S.-Israeli operations, underscores why Israel must prioritize neutralizing such networks to safeguard its survival.

Neutral

Oil tanker traffic through the Strait of Hormuz has not returned to prewar levels following Iran's closure of the waterway on February 28 in response to U.S. and Israeli military action. Shipowners face ongoing decisions about resuming transits due to risks of renewed conflict in the Persian Gulf and potential violations of U.S. sanctions when coordinating with Iranian authorities. Similar patterns have been observed in the Red Sea, where traffic dropped sharply in early 2024 amid Houthi attacks and remained below prior volumes two years later.

Western

The U.S. and Israeli strikes on Iranian targets successfully neutralized key threats but prompted Tehran’s illegitimate blockade of the Strait of Hormuz, triggering the largest oil-supply shock in decades and endangering global energy security. Even if a diplomatic deal is reached, commercial traffic is unlikely to return to pre-conflict levels, as Western shipowners assess the persistent risk of renewed Iranian aggression and the sanctions exposure tied to any coordination with the Revolutionary Guard. NATO-aligned forces will therefore prioritize sustained maritime presence and precision deterrence to safeguard freedom of navigation through this critical chokepoint.

Pro-Peace

The U.S.- and Israel-launched war on February 28 provoked Iran’s blockade of the Strait of Hormuz, triggering the largest oil-supply shock in history and inflicting severe humanitarian costs through skyrocketing energy prices that hit civilians hardest in import-dependent nations. Even if a deal emerges, persistent risks of renewed fighting and sanctions will likely keep tanker traffic suppressed, prolonging economic hardship and civilian suffering rather than restoring stability. Prioritizing sustained diplomacy over military escalation could have prevented these cascading human costs from the outset.

Global South

The US-Israel war and ensuing sanctions regime have compelled Iran to exercise sovereign control over the Strait of Hormuz, triggering the largest oil disruption in history and exposing how Western powers weaponize maritime access to enforce neo-colonial dominance. Global South importers now face sustained supply constraints as shipowners weigh the risks of US penalties against cooperation with Tehran, mirroring the Red Sea’s failure to recover after Houthi resistance to external intervention. International institutions have proven incapable of curbing such aggression or restoring equitable navigation, leaving energy routes hostage to great-power leverage.

Actors involved

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Sources

Spencer KimballBy Spencer Kimball
- Oil tanker traffic through the Strait of Hormuz may not return to prewar levels even if the U.S. and Iran reach a deal. - Ship traffic in the Red Sea, for example, plummeted in early 2024 due to Houthi militant attacks. Two years later, traffic still not returned to previous le…

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Jul 21, 2026strikeUnverifiedUSIranProxy

Another ship hit in Hormuz as Houthis add to regional risks

○ 1 source

Another ship hit in Hormuz as Houthis add to regional risks A tanker has been struck by an unknown projectile northeast of Oman’s Limah, UK Maritime Trade Operations says on Tuesday - Hormuz was deserted on Jul 21, with no ships observed transiting, data shows.

PHOTO: REUTERS [SINGAPORE] Another tanker was attacked in the Strait of Hormuz as renewed hostilities empty the waterway, while a threat by Houthi rebels to blockade Saudi Arabia in the Red Sea heightened regional maritime risks. The Kaifan, an oil products tanker owned by Kuwait Oil Tanker, was the vessel attacked in the strait, according to security consultancy EOS Risk Group.

The ship was struck by an unknown projectile northeast of Oman’s Limah, UK Maritime Trade Operations said earlier on Tuesday (Jul 21), without naming the tanker. Kuwait Oil Tanker did not immediately respond to emailed requests for comment, and ship tracking data shows Kaifan last signalled its location more than a month ago near Sohar, Oman.

The attack on the Kuwaiti tanker follows strikes in recent days on vessels owned by Dynacom Tankers Management. Hormuz was deserted on Tuesday, with no ships observed transiting, data shows. Iran’s recent spate of attacks has focused on oil tankers shuttling through the strait along the Omani coast, often with their transponders turned off.

Earlier strikes have affected major operators such as South Korea’s Sinokor Group and Greece’s Dynacom, which have been instrumental in sustaining crude flows during much of the war with tankers sailing through Hormuz dark. In the week ended Jul 19, Hormuz crossings averaged seven tankers each day, compared with 16 per day a week earlier, said Rahul Kapoor, global head of shipping analytics and research for S&P Global Energy.

“Ship operators remain increasingly cautious, with risk tolerances continuing to be tested,” he said. An empty Sinokor supertanker, Plata Singapore, that was sailing towards the Gulf of Oman with the aim of reaching Saudi Arabia’s Ras Tanura in the Persian Gulf, deviated from its path on Sunday, according to ship tracking data.

The vessel is currently in the Arabian Sea. The South Korean company did not immediately respond to an emailed request for comment. The threat by Iran-backed Houthi militants to blockade Saudi Arabia’s maritime traffic has added another element of risk.

Shipowners with vessels seeking to transit the Red Sea were advised to review their affiliations with the kingdom, with at least one supertanker in nearby waters switching its broadcast to say that it belongs to the Indian government. The India-flagged supertanker, Desh Viraat, which is half-filled with crude from Fujairah, began sailing southwest earlier this week towards Bab el Mandeb in the Gulf of Aden, signalling it had armed guards onboard.

Soon after the Houthi threat on Monday, it switched that signal to “Govt. of India Await”, making clear that it has links to New Delhi. Desh Viraat’s owner, the Shipping Corporation of India, did not immediately respond to an emailed request for comment.

“Companies maintaining regular Saudi trade should consider their exposure elevated, particularly for vessels calling at Red Sea ports,” maritime risk company Marisks said in a note to clients late on Monday that was seen by Bloomberg News. Even though it remains to be seen whether the Houthis will carry through with their threat, “for shipowners, risks have heightened”, said Anoop Singh, global head of shipping research at Oil Brokerage.

“If you have an alternate voyage to take, then you will take that and avoid those in the region.” BLOOMBERG Decoding Asia newsletter: your guide to navigating Asia in a new global order. Sign up here to get Decoding Asia newsletter. Delivered to your inbox.

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Oil prices to hit $120 soon? Goldman Sachs makes big prediction as Hormuz concerns loom

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Goldman Sachs has projected Brent crude averaging $80 per barrel in the fourth quarter and $75 in the following year, conditional on reduced Middle East tensions, while noting upside risks from potential shipping disruptions in the Strait of Hormuz or Red Sea.

Brent prices rose above $91 per barrel amid recent U.S.-Iran exchanges and Houthi threats to Saudi shipments before edging lower on Tuesday. A senior Iranian official told Reuters that mediators had proposed a 10-day ceasefire to preserve an interim agreement.

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Opening summary: Iran claims attacks on strait of Hormuz ships amid fresh US strikes Welcome to our live coverage of the latest developments in the Middle East crisis. Iran attacked a tanker in the strait of Hormuz early on Tuesday, forcing its crew to abandon the ship, as Yemen’s Iran-backed Houthis announced they were imposing an immediate maritime blockade of Saudi Arabia in the Red Sea after the two sides traded fire last week for the first time in years.

A Houthi official said the Bab al-Mandeb strait – at the southern end of the Red Sea, through which about 12% of the world’s trade usually passes – would be closed to the Saudis in response to the kingdom’s “unjust blockade on Yemenis for over 10 years”.

Saudi Arabia said it would take “all necessary measures to protect its vessels in accordance with international law”. A 10 consecutive night of US airstrikes has not compelled Tehran to loosen its grip on the strait of Hormuz, a vital route for global energy supplies.

But even as Iran’s president said the country had returned “full-scale war”, the Iranian interior minister travelled to Pakistan – a key mediator in the conflict – for talks. In key developments: The latest US strikes came hours after Donald Trump said Iran would pay “many times over” for killing US soldiers after multiple service members were killed in action over the weekend.

A tanker came under attack early Tuesday in the Hormuz strait off Oman, forcing the crew to abandon the vessel, the British military’s United Kingdom Maritime Trade Operations centre said. Iran’s Revolutionary Guards claimed the attack as well as two other attacks on ships in the waterway on Monday.

The US military’s Central Command said its latest airstrikes were to “degrade” Iran’s ability to attack commercial shipping in the strait and included hitting military command centres and missile and drone launch sites. Iranian media reported strikes in parts of the country including Bandar Abbas, Tabriz and Bushehr, home to the country’s only operational civilian nuclear power.

Iran’s launched attacks in response against Bahrain, Kuwait and Jordan, which all host US forces. Oil prices softened after hitting their highest levels in more than a month in the previous session. Brent crude futures eased 0.4% to $88.87 a barrel by 0052 GMT on Tuesday while US West Texas Intermediate crude for September delivery was steady at $82.

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