By Alex Longley, Grant Smith and Jack Wittels | Bloomberg
Shipowners painted a mixed picture of their willingness to continue transiting the Strait of Hormuz in the hours after President Donald Trump said the US ceasefire with Iran is “over.”
Of five owners surveyed by Bloomberg whose vessels have crossed the vital conduit for energy flows in recent weeks, three said they were assessing whether it’s still safe to transit, while two said they hadn’t yet changed their policies.
When it comes to oil flows, much will depend on the approach of Sinokor Group, the world’s largest owner of supertankers and a key player in Hormuz traffic since the conflict began. One of the company’s vessels was attacked on Tuesday and three shipbrokers who deal with the firm said they hadn’t been updated on its current position on transiting.
The risk of a return to all-out war appeared to be rising on Wednesday, with Trump warning that the US would probably launch further strikes on Iran and could resume a blockade on the country’s ports.
In these circumstances, how much crude continues flowing out of the waterway, and the resulting impact on global oil prices, may come down to the decisions of the narrow cadre of shipowners that have been willing to enter Hormuz.
Two owners that have previously sent ships into Hormuz showed some willingness to continue. Their vessels passed through the waterway under cover of darkness in the hours after the US resumed strikes on Iran, according to vessel-tracking data compiled by Bloomberg.
Visible traffic on Wednesday was muted on the Omani side of Hormuz — a shipping corridor that has become the primary alternative to Iranian-controlled waters. Amid the heightened tensions, ships may be more likely to make the transit without broadcasting their locations. The tendency of some tankers to exit the Persian Gulf in convoy formations has also made daily totals volatile.
Benchmark tanker earnings, which reflect the cost of entering the Persian Gulf, rose to more than $340,000 a day on Wednesday, $50,000 higher than the end of last week. The marker has been highly illiquid since the Iran war began and is prone to large swings.
Higher shipping costs will be a fresh headache for Gulf producers who were already grappling with a lack of vessels willing to enter Hormuz. Last month, Iraq had to reduce output at some fields because it was unable to find enough ships to load its cargoes.