Strait of Hormuz Blockade Sparks Shipping Crisis, Oil Surge

Official sources present conflicting reports on whether the Strait of Hormuz is open or closed, but traffic has largely stopped completely due to the war. According to major media reports, traffic through the strait has plummeted by 90% since the conflict began, with only around 150 vessels transiting since March 1 compared to about 100-135 per day pre-war. This dramatic collapse underscores the severe impact of regional hostilities on one of the world's most vital maritime chokepoints.

Iran has effectively blocked the Strait of Hormuz, except for vessels carrying its own oil to allies, according to major media reports. Tehran is positioning itself as the gatekeeper, implementing a 'toll booth' system with inspections by the Islamic Revolutionary Guard Corps (IRGC). The IRGC says the strait remains under Iran's 'full control' and open for non-military vessels, but it declared the strait closed on 2 March, threatening to set fire to ships trying to pass. Iran's new supreme leader Mojtaba Khamenei called for using 'the lever of blocking the Strait of Hormuz', which the Revolutionary Guards vowed to carry out. Iran grants safe passage to ships from friendly countries under a vetting system, but the specific rules or conditions remain unclear.

The U.S. military announced a blockade of all Iranian ports starting Monday, enforced impartially against all nations, according to U.S. Central Command. The strait remains closed to traffic and will be subject to a U.S. naval blockade, major media reports indicate. The United States Central Command said that it had attacked 16 Iranian mine-laying vessels near the Strait of Hormuz on March 11. The U.S. attacked Kharg Island, destroying military targets but sparing oil infrastructure, and is considering occupying or blockading Kharg Island to pressure Iran, according to sources to Axios. The U.S. launched an operation to reopen the strait, deploying jets and helicopters, in a bid to restore international passage.

A ceasefire agreement required Iran to reopen the strait, but it remains effectively closed, according to major media reports. The blockade halted limited ship traffic that resumed during the ceasefire, with over 40 commercial ships crossing the strait during that period, down from pre-war levels. According to Sveriges Radio Nyheter, Cecilia Uddén described this as showing how fragile the ceasefire is, highlighting the precarious nature of diplomatic efforts in the region.

Severe shipping disruptions have left around 670 cargo ships waiting on the western side of the strait, with 120 owned by UAE companies, major media reports indicate. Tanker traffic dropped sharply in the Strait of Hormuz as satellite navigation systems were disrupted, according to data and analytics firm Kpler. Tehran's retaliatory strikes on shipping and Gulf neighbours have nearly cut off maritime traffic through the Strait of Hormuz, research sources report, though the exact number of stranded ships varies widely.

Violent attacks on ships have resulted in casualties, with at least 18 ships hit and 7 crew killed in the strait, according to the U.N. International Maritime Organization. A bomb-carrying drone boat struck a Marshall Islands-flagged oil tanker in the Gulf of Oman, killing one mariner, according to Oman. An attack on two oil tankers off Iraq killed at least one crew member, while a cargo ship caught fire after being hit by shrapnel, research sources indicate. Iran has been threatening vessels approaching the Strait of Hormuz and is believed to have launched multiple attacks, adding to the peril for maritime operators.

The U.K. Maritime Trade Operations Center reported attacks on several vessels in the area around the Strait of Hormuz and warned of elevated electronic interference, complicating navigation and safety for remaining traffic. This electronic warfare dimension adds another layer of risk in an already volatile environment, deterring commercial shipping from attempting passage.

Global oil markets are in crisis, with oil prices rising after the blockade announcement, with U.S. crude at $104.24 and Brent at $102.29 per barrel, according to major media reports. Energy prices rose sharply on Monday due to disruptions to tanker traffic through the Strait of Hormuz and damage to production facilities from U.S. and Israeli attacks on Iran, research sources indicate. Oil prices pared their gains after Iran's deputy foreign minister said that Tehran had allowed ships from some countries to cross the Strait of Hormuz, but Brent crude peaked at $101.59 per barrel and is above $100 per barrel, conflicting with other reports of $77.74 per barrel. The International Energy Agency said the Mideast war 'is creating the largest supply disruption in the history of the global oil market', underscoring the scale of the crisis.

In response, the International Energy Agency member countries agreed to unlock 400 million barrels of oil from their reserves, their largest release ever, according to research sources. This strategic move aims to stabilize markets and mitigate the impact of the supply shock, but its effectiveness remains to be seen given ongoing disruptions.

Mine-clearing efforts are underway, with the Royal Navy offering seaborne drones for mine-clearing in the region, as HMS Middleton is under maintenance, major media reports indicate. According to BBC News, Tom Sharpe, a former Royal Navy commander, described new British mine-clearing technologies as yet to be tested in combat, highlighting operational challenges in securing the waterway.

The Strait of Hormuz is a strategic chokepoint through which about one-fifth of the world's oil passes, making its closure a critical threat to global energy security. Its importance to international trade and geopolitical stability cannot be overstated, with any disruption reverberating across economies worldwide.

Reactions from regional and global stakeholders have been mixed, with former U.S. President Donald Trump suggesting that failing to secure the Strait of Hormuz would be 'very bad for the future of Nato'. Gen Sir Nick Carter said Nato was created as a defensive alliance, not for wars of choice, while German Defence Minister Boris Pistorius questioned what Trump expects from European navies. Trump threatened to reconsider sparing oil infrastructure if Iran disrupts strait passage and expressed surprise and disapproval that Iran is charging fees for strait passage. U.S. President Donald Trump said that stopping Iran's 'evil empire' was more important than crude prices, reflecting a hardline stance. According to HuffPost UK, James Hanson mocked Trump for not foreseeing Iran's retaliation by closing the strait, adding to the political discourse.

Implications for global trade and energy security are profound, with supply chains for critical commodities like helium, jet fuel, and fertilizer at risk, though the full extent of damage is unknown. The crisis threatens to exacerbate inflation and economic instability in regions dependent on Middle Eastern oil, prompting calls for diversified energy sources and maritime routes.

Key unknowns persist, including what specific rules Iran is applying for ships to pass under its 'toll booth' system and whether the U.S. blockade is being enforced impartially as announced. The timeline for when the strait will fully reopen to normal international traffic remains uncertain, with ongoing military and diplomatic maneuvers shaping the outcome. According to Sveriges Radio Nyheter, Cecilia Uddén described shipping companies warning about possible passage before it becomes clear what rules actually apply, emphasizing the operational confusion.

Further unknowns include the exact number of ships currently stranded, as reports vary widely, and the full extent of damage to global supply chains for critical commodities. According to GB News, Captain Raman Kapoor described being stranded in the strait as 'terrifying', with missiles flying overhead, illustrating the human toll of the blockade. The enforcement of the blockade and the potential for escalation continue to pose risks to regional stability and international commerce.