Hormuz is still paralyzed? Iran has announced the closure of the strait, the US denies it

Yesterday (Saturday), US Vice President J.D. Vance denied this before leaving for talks with Iran that are expected to continue in Switzerland. In practice, most shipping companies are still refraining from returning to full activity, and hundreds and perhaps even thousands of ships continue to wait in the Persian Gulf until the situation is clarified.

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Despite the contradictory statements, movement in the Strait remains very limited. According to the Hormuz Tracking website, which is based on the visible identification broadcasts of the vessels in the area, the number of crossings in Hormuz today is zero. Some of the ships that choose to leave the bay do so in the dark while turning off their identification transmitters. US President Donald Trump claimed last week that US forces escorted about 200 ships out of the Gulf in this way.

Also according to the maritime intelligence agency Lloyd’s List, ships continue to pass through the strait despite the Iranian statements. “Ships continue to pass through the Strait of Hormuz over the weekend despite new Iranian claims that the road has been closed, and threats to act against ships that do not comply,” the report said. At the same time, the US continues to escort vessels in the region, but sources in the industry estimate that significant maritime traffic will not resume until security and commercial certainty is achieved.

Many concerns and challenges

The agreement signed by the United States and Iran last week should include the lifting of the American embargo on Iran and the reopening of the Strait of Hormuz, which has been closed since the beginning of March following the joint Israeli-American attack on Iran. However, even if the parties continue to implement the understandings, the shipping industry estimates that the road to normalcy will be long.

The insurance agencies continue to define the area as having a high level of risk and require insurance in an extremely high amount or refuse to insure at all. In practice, this is a significant barrier preventing the return of many shipping companies to full activity. As long as the situation continues, the ability to export oil and gas from the Gulf countries is also affected. Despite this, oil prices are currently trading around 75-80 dollars per barrel, significantly lower than the peak levels recorded during the war.

Even if certainty is achieved, it is not clear what the return to normal will look like. Yehuda Levin, director of research at the Israeli start-up Freitos, which deals with sea and air shipping pricing, explains: “The answer is that no one knows how it will work, whether there will be a comprehensive body, etc. But there is definitely not enough room for everyone at once. In addition to being narrow to begin with, the Strait of Hormuz will actually be even narrower due to the suspicion that Iran has made the central axis more difficult.”

According to him, the fear of exploitation left in practice only two main transit routes: one along the Iranian coast and the other off the coast of Oman. “Only these remain in use and are considered mine-free,” he says.

In a meeting with shipping industry executives organized by Lloyd’s List, additional concerns were raised. Very large oil tankers (VLCC) may find it difficult to pass through the narrow passages that remain open, and are at increased risk of running aground. In such an extreme scenario, they may even block some of the sailing routes that remain available.

Beyond that, the oil industry emphasizes that the main challenge is not only the departure of the tankers loaded with oil from the Gulf, but rather the entry of empty tankers. Only their return will make it possible to start emptying the reserves of crude oil that accumulated in the Gulf countries during the war.