Ceasefire or not, Hormuz tanker traffic may take months to recover

The US and Iran’s “fragile ceasefire” has raised hopes that a full reopening of the Strait of Hormuz could end an energy supply crisis that threatens to cripple the global economy.

But shipping and maritime experts say traffic on the critical energy artery will not normalize anytime soon.

President Donald Trump said Tuesday that the ceasefire was contingent on the “complete, immediate and safe opening” of the Strait, which usually carries about one-fifth of the world’s oil and natural gas resources.

Vice President J.D. Vance reiterated Wednesday that the Iranian leadership has agreed to open the Strait of Hormuz.

However, Iran has made clear that the reopening will be conditional, subject to coordination with the country’s armed forces and technical limitations.

The fragile ceasefire has done little to restore confidence in the passage of tankers through the strait, especially as signs of its collapse appear as Israel steps up its deadliest attacks on Lebanon.

Traffic in the Strait of Hormuz has yet to see a meaningful recovery, with just four crossings recorded on Wednesday, according to S&P Global Market Intelligence.

“Vessels still appear to be using the modified transit route west across Larak Island,” he said.

More than 400 oil-laden tankers and dozens of LNG or LPG carriers are anchored outside the Gulf, waiting for signals to pass, according to MarineTraffic, a ship tracking platform that uses a radio-based AIS, or automatic identification system.

Actual transit volumes may be higher than the data suggest because many tankers have turned off their transponders to prevent them from being potentially targeted by Iran, but remain at a fraction of pre-war levels.

According to maritime research firm Windward, passage conditions, fee regulations and the legal framework for passage remain undefined, deterring ship owners from transiting the waterway.

“It is unclear whether Iran will maintain control of Hormuz during the talks, but all signs point to the Islamic Republic refusing to give up its influence over the two-week period,” Windward wrote in a note on Wednesday. he said.

Windward added that the first 48 hours of the ceasefire will be very important in terms of shipowners’ willingness to enter the Bosphorus.

“We are weeks away from our industry returning to normal,” Nils Haupt from Hapag-Lloyd, one of the world’s largest shipping companies, told CNBC on the phone. According to the latest risk assessment, the company is currently avoiding transiting the Bosphorus.

“The problem is not solved…[until] All ships left the Strait of Hormuz because there were hundreds of thousands of containers in the ports of India, Oman and Pakistan that needed to be transported to the Persian Gulf.

“It will take weeks, if not months, to reintroduce the original shipping schedules we had before the start of the war.”

Maersk said in a statement that while the ceasefire could create transit opportunities, it did not yet provide complete maritime certainty and “all associated potential conditions need to be understood”.

Analysts told CNBC that Yemen’s Houthis’ disruption of the Red Sea last year provides a reference point for how quickly traffic could recover following a potential ceasefire.

“The ceasefire agreement with the Houthis in the Red Sea was made last January and traffic has not returned,” Nikos Petrakakos, managing director of maritime investment manager Tufton, said in an interview with CNBC. “As long as there is a threat of attack, that’s enough. You don’t actually need an attack.”

Kpler tanker cargo analyst Panagiotis Krontiras said one of the differences between the Red Sea and Strait of Hormuz scenarios is the availability of alternative routes.

“In the former, seaborne flows can be rerouted via the Cape of Good Hope, while in the latter rerouting options are much more limited and largely limited to pipeline diversion,” he added. “Therefore, market dynamics will likely encourage a faster recovery of Strait of Hormuz traffic.”

Both US WTI and Brent crude oil prices have fallen to around $97 per barrel from around $110 per barrel on Tuesday, when the ceasefire was announced, but remain well above the pre-war level of $70.

Analysts expect oil to continue trading at a level higher than its pre-war price for some time due to the continued supply disruption.

“Physical and logistical disruptions will not disappear overnight,” said Ray Sharma-Ong, global vice president of multi-asset bespoke solutions at Aberdeen Investments, adding that shipowners globally also face higher shipping costs, war risk insurance and precautionary stockpiling.

“This is not just a financial issue,” Petrakakos added; Ship captains had the responsibility of deciding whether to risk passing through the Bosphorus.

“For now most [captains] They rightfully think, ‘I don’t care how much the jackpot is, it’s not worth risking my life.’ This may change over time.”