Iran Threatens Ships as Strait of Hormuz Reportedly Closed

A senior figure in Iran’s Islamic Revolutionary Guards Corps said the Strait of Hormuz has been closed and warned that any vessel attempting to pass through the waterway could be attacked, Reuters reports.

Ebrahim Jabari, an adviser to the Guards’ commander-in-chief, said Iranian forces would target ships trying to transit the strait. According to remarks reported by state media, both the Revolutionary Guards and Iran’s regular navy would act against vessels attempting to cross.

Key global oil route

The Strait of Hormuz, located between Iran and Oman, connects the Persian Gulf with the Gulf of Oman and the Arabian Sea. At its narrowest point the passage is about 33 kilometres wide, while shipping lanes in each direction are roughly 3 kilometres across.

Roughly one fifth of the world’s oil consumption moves through the strait. Data from analytics firm Vortexa show that more than 20 mln barrels of crude oil, condensate and fuel passed through the route daily on average last year.

Several major producers rely heavily on the corridor. Saudi Arabia, Iran, the United Arab Emirates, Kuwait and Iraq export most of their crude through the strait, largely to Asian markets. Qatar, one of the world’s leading exporters of liquefied natural gas, also ships nearly all of its LNG through the same route.

Shipping disruption grows

The escalating conflict has already disrupted maritime traffic. Jeremy Nixon, chief executive of container shipping company Ocean Network Express, said around 100 container ships are among roughly 750 vessels currently delayed near the strait. That accounts for about 10% of the global container fleet.

Maritime insurers have begun cancelling war risk coverage for ships operating in the Gulf following attacks linked to Iran’s retaliation against U.S. and Israeli strikes.

At least four tankers have been damaged, two seafarers have been killed and around 150 vessels remain stranded in the area as tensions intensify around one of the world’s most important energy chokepoints.

Kursiv also reports that global stocks fell on Tuesday while the U.S. dollar strengthened as investors weighed the economic impact of American and Israeli strikes on Iran.

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