TTanker markets have returned to their “wartime behavior”, following the latest round of strikes in the Middle East. In its latest weekly report, shipbroker Intermodal said: “A memorandum of understanding between Washington and Tehran in mid-June, which set a 60-day framework for a final settlement, briefly raised hopes that the Hormuz crisis was moving toward a stable resolution. Those expectations quickly faded. Over the past week, renewed Iranian attacks on commercial ships crossing the strait prompted Washington to reimpose oil export sanctions suspended under the agreement. The ceasefire effectively collapsed when the United States exchanged United States and Iran air strikes, endangering commercial shipping. Following the renewed attack, Tehran again announced the closure of the Strait of Hormuz and ship traffic declined sharply, reversing the recovery in crossings recorded in late June and early July. In addition to direct hostilities, the broader question of how the waterway will ultimately be managed remains unresolved, leaving the region caught between further escalation and another attempt at de-escalation.
Source: Intermodal Shipbrokers
According to Intermodal’s chief analyst, Nikos Tagolis, “For shipping markets, the deeper consequences lie in the erosion of confidence in any settlement. This is the third arrangement to collapse since February, and each new understanding is increasingly seen as temporary. Against this background, charter companies are adopting a more cautious stance, monitoring how the situation develops, while prolonged instability is likely to make more owners reluctant to transport cargo to the Gulf region in the Middle East.” He explains Reaction to July outbreak Sensitivity of freight rates to geopolitical signals TD3C earnings, which corrected to below $290,000 a day once the post-MOU rally ended, turned sharply higher as hostilities resumed, rising 18% within four trading days to around $344,000 within a week, and have become a recurring feature of the market since the crisis began, with interest rates responding primarily to headlines rather than underlying cargo flows.
Source: Intermodal Shipbrokers
“The longer the disruption lasts, the more suppliers and alternative routes will strengthen their position within the market,” Mr Tagulis said. The US has boosted its oil and liquefied natural gas (LNG) exports, strengthening its role as a major energy supplier, while other Atlantic Basin producers, including Brazil, Canada and West Africa, are expanding their market share in Asia through longer journeys Structurally, a redirection of trade flows that supports ton-mile demand even as Gulf volumes shrink. India and China are expanding LNG shipments eastward, although Europe has so far remained the main outlet for Yamal’s production. In parallel, producers in the Middle East are accelerating investment in export infrastructure that bypasses the strait altogether, starting with expanding crude oil pipelines to terminals outside the Gulf, to larger volumes being routed through Mediterranean ports, currently estimated at about 6.4 million barrels per day, which could rise to more than 10 million barrels per day as planned projects approach. This would provide a partial buffer Against lane disruption, diverting rather than eliminating maritime demand, as pipeline barrels will remain loaded on tankers outside the strait The unstable backdrop surrounding the Hormuz situation is also weighing heavily on the LNG market, keeping Qatar, the world’s second-largest exporter, at a fraction of its normal export levels and leaving a large share of global LNG supplies exposed to conflict, while Iran’s targeting of a Qatari LNG tanker has left the sector feeling vulnerable, the Intermodal analyst said.
“Overall, the Hormuz crisis is settling into a recurring cycle of escalation, partial easing, and renewed tension, with each episode making the market less confident in the sustainability of any settlement. The key trading issue is therefore not simply whether the strait is actually open, but whether shipping market participants view it as reliably tradable. Until this confidence is restored, crude oil and LNG flows will continue to shift toward alternative routes and suppliers, supporting ton-mile demand while maintaining volatility.” In Ship Deployment and Balances Regional tonnage and freight revenues,” concluded Mr. Tagulis.
Nikos Rousanoglou, Global Hellenic Shipping News
