Nearly at a standstill! Only 2 ships passed through the Strait of Hormuz in 24 hours; U.S. "escort" failed to restore confidence.
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The Middle East conflict continues to escalate, and the Strait of Hormuz is on the verge of a near-total shutdown.
On March 6, according to Bloomberg, the Joint Maritime Information Center (JMIC) reported that vessel traffic through the Strait of Hormuz has dropped to single digits, with only two commercial vessels recorded crossing in the past 24 hours. JMIC has described this situation as a "near-total temporary suspension of routine commercial traffic."
The report states that dozens of oil tankers loaded with oil and gas are currently stranded in the Persian Gulf, not daring to attempt crossing the strait recklessly. Frequent vessel attacks have put energy tankers and their cargo worth millions of dollars at extremely high risk. Meanwhile, international insurance companies have begun shrinking their war risk coverage, further intensifying panic in the shipping market.
Although the Trump administration has introduced interventions such as tanker insurance guarantees and naval escorts, the nearly interrupted state of passage through the Strait of Hormuz indicates that market concerns have not yet been alleviated. Oil prices have not surged as much as before but remain at high levels. As of press time, Brent crude was up 0.14%, holding above $85. The White House is currently considering releasing strategic petroleum reserves and temporarily waiving fuel blending requirements to further stabilize oil prices.
Traffic Plummets, Strait Enters "De Facto Blockade"
As a critical global oil and bulk commodity transportation corridor, the Strait of Hormuz is currently seeing a dramatic drop in traffic. The latest data from the Joint Maritime Information Center (JMIC) show that on March 4, only one inbound and one outbound vessel were observed passing through the strait, bringing traffic to an extremely low level.
It should be noted that these statistics include only vessels with Automatic Identification Systems (AIS) turned on, and do not capture ships traveling covertly with AIS turned off. The two vessels confirmed to have passed through were both cargo ships, not tankers, meaning energy transportation has effectively stalled.
Facing the withdrawal of international insurance companies from the war risk market, Washington announced this week that it would provide insurance backstops and deploy naval escorts to try to boost market confidence. However, these measures have yet to dispel shipowners' concerns, and most tankers still choose to remain in place.
With supply disruption expectations continuing to intensify, oil prices face strong upward pressure in the short term. The market will closely watch how the Middle East situation evolves and whether shipping lanes can be restored to normal soon.
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