Vessel traffic through the Strait of Hormuz remains limited as the US and Saudi Arabia attacked Iranian proxy groups in Iraq in response to Iran’s attempted attacks on US forces the previous day.
The US Central Command (CENTCOM) said it struck dozens of Islamic Revolutionary Guard Corps (IRGC) targets in Iran, including military command centers, missile and drone facilities, coastal surveillance and defense sites, and maritime capabilities.
According to the Islamic Revolutionary Guard Corps (IRGC)-affiliated Fars News, Iran attacked Jordan’s Al-Azraq Air Base with several ballistic missiles.
Meanwhile, the US targeted two Iranian companies it accused of coordinating passage through the Strait of Hormuz and charging and collecting fees for transits.
The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Persian Gulf Marine Insurance Company and HormuzSafe Marine Services Authority.
Through these two companies, “the regime brokers IRGC-approved policies designed to extract revenue under the guise of maritime services, including payments in digital assets to evade sanctions – allowing Iran to tighten control over shipping activity and funnel funds into IRGC operations,” OFAC said.
According to the Strait of Hormuz tracker, a free, real-time dashboard that tracks the ongoing crisis using AI-powered analysis of current Strait conditions, insurance markets and diplomatic developments using real-time web data and AIS data for vessel positions, 10 vessels have transited the Strait over the past 24 hours.
For context, transits averaged about 150/day prior to the US-Iran war.
BAB EL-MANDEB STRAIT
Concerns over passage through the Bab el-Mandeb Strait have emerged after Yemen’s Houthi Rebels fired ballistic missiles at a Saudi oil tanker in the Red Sea.
The Houthis have declared a blockade on Saudi ships in retaliation for Saudi Arabia’s long-standing blockade of Yemen, which they claim has caused humanitarian and economic hardship.
Yahya Saree, official spokesman for the Yemeni Armed Forces, said Yemeni Armed Forces targeted the Saudi oil tanker NCC Ghazal in the Red Sea.
Further supply risks emerged in the Black Sea, where tankers scheduled to load at the Caspian Pipeline Consortium (CPC) terminal headed away from the region after a vessel was hit during loading. The terminal is the main export route for Kazakh crude.
Even amid the activity in the Red Sea, Reuters reported that transits through the Bab el-Mandeb Strait on Tuesday were at the highest in a week.
Despite the escalations, crude prices fell on Thursday as continued talks between Iran and Oman raised hopes of progress towards reopening the Strait of Hormuz.
BACKGROUND
Transits through the Strait of Hormuz resumed on 19 June after the US and Iran signed a memorandum of understanding (MoU). Traffic through the Strait had been essentially halted since late February when the US and Israel attacked Iran.
The closure has had significant impact on crude oil and chemical markets as around one-third of global seaborne crude flows and up to 20% of the world’s total oil flows pass through.
A full closure of the Bab el-Mandeb Strait would reduce global oil supply by 7% as it would leave most of Saudi oil exports unable to leave the region.
The Hormuz closure had less impact on container shipping as less than 2% of global container capacity passes through the Strait each year, though it contributed to higher rates mostly because of surging bunker fuel prices.
Container ships and costs for shipping containers are relevant to the chemical industry because while most chemicals are liquids and are shipped in tankers, container ships transport polymers, such as polyethylene (PE) and polypropylene (PP), which are shipped in pellets. Titanium dioxide (TiO2) is also shipped in containers.
They also transport liquid chemicals in isotanks.
Source: ICIS by Adam Yanelli,
