Traffic at the Strait of Hormuz remains at the lowest in more than two months as security concerns have intensified with recent attacks on ships and persistent threats to shipping in the region.
After a brief respite between the middle of June and early July, when traffic at Hormuz rose with the tentative opening of the chokepoint as part of the now-dead U.S.-Iran memorandum of understanding, traffic of all vessels, including commodity carriers, plunged to a two-month low as of the end of July.
And it hasn’t recovered, despite U.S. attempts to talk down oil prices and an announcement that talks with Iran would begin anew.
The security situation has actually deteriorated in the past two weeks, with Iran determined to exert control over vessels transiting the Strait of Hormuz and the Iran-aligned Houthis threatening Saudi-linked shipments in the Red Sea and the Bab el-Mandeb Strait leading into the Arabian Sea.
As a result, traffic at the Strait of Hormuz remained subdued as of Tuesday, according to ship-tracking data monitored by Bloomberg. The trickle of traffic is extending the period in which tanker owners are either using dark mode to transit the chokepoint, abandoning efforts to cross, or not risking transits at all.
This weekend, the Egypt Prosperity, a very large crude carrier (VLCC), aborted an attempt to exit the Persian Gulf following direct threats over radio, according to alerts by security consultancies seen by Bloomberg News. The crew on the Egypt Prosperity also reported they had heard explosions close to the vessel.
Analysts at security and vessel-tracking firms told the BBC this week that the threats to shipping in the Gulf and the Red Sea have now escalated to the worst safety situation since the Iran war began.
“In terms of threat to the trade of crude, we’re at the worst period that we’ve been in since this since this crisis began,” Matthew Wright, an analyst at ship-tracking firm Kpler, told the BBC.
By Charles Kennedy for Oilprice.com
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