The US and Iran issue conflicting orders over the Hormuz shipping route, leaving shipowners facing dual threats of sanctions and seizure.

There is serious opposition between the navigation directives of the US and Iran in the Strait of Hormuz. Although a ceasefire agreement at the macro level has driven the strait’s traffic to its highest level since the conflict began, micro-level navigation games are pushing international shipowners and insurers into a dual dead end of sanctions compliance and physical safety.

According to a Tuesday report from the Financial Times, the US has launched an Oman-side “Guardian Angel” escorted route protected by US military air cover, while Iran is demanding that vessels sail close to its coast and pay a transit fee. These diametrically opposed directives have shattered the optimistic expectations brought by the macro-level memorandum of understanding, making actual operations in the shipping market full of uncertainty.

Despite the severe conflict in directives, the Strait of Hormuz’s 24-hour traffic has surpassed 30 vessels, setting a new record since the outbreak of conflict at the end of February. Meanwhile, the UK Maritime Trade Operations (UKMTO) office has downgraded the operational risk level of this area from “severe” to “moderate,” indicating that capital and the shipping market are rebalancing risks and returns.

For the global energy supply chain, while the implementation of macro agreements has reduced geopolitical premiums and Brent crude has fallen below $80/barrel, compliance risks in micro-level routes, if triggering local detentions or sanction incidents, could still disrupt fragile shipping insurance rates and the spot oil market at any time. Investors need to watch out for the frictional costs during the agreement execution phase.

US-Iran Directive Opposition: Oman-Side Escort vs. Iran-Side Fees

With the signing of the memorandum of understanding between the US and Iran, the Strait of Hormuz has reopened and moved into the implementation phase, but disagreements on specific navigation routes are intensifying.

The US has established a “Guardian Angel” escorted route named by Trump, located on the Omani side of the strait and protected by close-range US military air cover. Western insurers generally recommend vessels follow this protected route.

However, Iran has issued completely opposing new regulations. Tehran requires that all vessels obtain permission in advance and are forced to sail close to Iran’s coast. According to cargo insurance brokers, Iran insists that vessels using its route pay a transit fee and warns that if regulations are not followed, vessels will face “punishment” or even be forced to turn back.

Operational Dead Ends for Shipowners and Insurers: Sanctions Compliance vs. Physical Safety

This disconnect between macro agreements and micro directives has trapped shipowners and operators in an irresolvable operational dilemma.

Dr. SV Anchan, chairman of the US shipping company Safesea Shipping, pointed out, If shipowners follow the advice of insurers and US authorities and sail closer to Oman, they will face interference, detention, or potential hostile actions from Iranian authorities. Conversely, if they comply with Iranian directives and sail close to Iran’s coast, it could trigger US sanctions-related compliance risks and be seen as violating insurers’ navigation advice.

“The US tells ships to take the Oman route and provides air support, while Iran insists on its route and collects transit fees. This lack of coordination could ultimately end badly,” commented a cargo insurance broker.

Although Western shipping interests are pushing for the Oman route, a tanker industry executive revealed that there are still many shipowners exploring the Iranian route as a backup option, trying to find the optimal solution in a tight squeeze.

Risk Downgrade and Recovery in Navigation: Market Reprices Amid Fractures

Despite geopolitical gaming and directive conflicts, the shipping market has already started repricing risks with actual actions.

Data shows that after the US-Iran memorandum of understanding was signed, traffic in the Strait of Hormuz rebounded significantly over the weekend. Within 24 hours by mid-week, more than 30 vessels passed through the disputed waters, marking the highest single-day volume since the conflict broke out on February 28.

With the recovery in traffic, the UK Maritime Trade Operations (UKMTO) office has downgraded the operational risk level in the area from “severe” to “moderate.” This adjustment reflects that, after the US military effectively lifted the maritime blockade on Iran, the market’s concerns over physical safety in the strait are being substantially eased.

From a macro asset performance perspective, the implementation of the agreement and end of the blockade have sharply diminished worries about disruptions in oil supply. Both spot and futures prices for Brent crude have fallen below $80/barrel, further squeezing geopolitical conflict premiums. However, beneath the rebound in traffic and risk downgrade, the US and Iran’s shadow battle over route control and transit fee collection continues, and this will be the key variable deciding whether the Strait of Hormuz can achieve long-term, frictionless navigation.

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