economy
Oil shock worsens as Strait of Hormuz closure nears two months
Shipping traffic through the Strait of Hormuz is at an effective standstill nearly two months into the Iran war, meaning the oil shock is mounting.
TL;DR
- Shipping traffic through the Strait of Hormuz is at a standstill nearly two months into the Iran war.
- The closure has halted roughly 20% of global oil trade, leading to soaring crude and gas prices.
- Iran has presented a proposal to reopen the strait, but it is unlikely to be accepted due to conditions attached to nuclear deal negotiations.
- Pre-war traffic averaged 130-140 ships per day, while current traffic has dropped by as much as 97%.
- The U.S. military implemented a blockade of Iranian ports on April 13, further impacting traffic.
- Analysts and executives expect a recovery period of several months, with some surveys indicating normalization by November or later.
- The risk of underwater mines could delay traffic recovery, with Pentagon officials estimating a six-month clearing process.
- Between March 4 and April 20, approximately 187 vessels transited the strait, with China and Hong Kong accounting for the largest share.
- Vessel presence across the Gulf region has shown a slight increase, but oil tanker traffic remains significantly reduced.