Escalation: Shipowners Prepare for Prolonged Strait of Hormuz Blockade

The situation in the Strait of Hormuz is escalating, and with the U.S. previously promising military escort that has yet to be fulfilled, this critical global energy chokepoint is being pushed toward a long-term blockade. Shipowners and traders are already preparing for the worst, and the global energy supply chain faces the most severe disruption risks in decades.

On March 12, according to CCTV News, early morning local time, officials at Iraq’s southern ports reported that two foreign oil tankers were attacked and set on fire within Iraq’s territorial waters. At least one person was killed, 38 crew members rescued, and Iraq immediately suspended operations at its oil ports. The attack on the oil tankers caused oil prices to briefly surpass $100 per barrel, leading to higher gasoline costs for consumers.

Although U.S. President Trump publicly stated that he would deploy the Navy to escort ships if necessary, according to officials from Gulf countries, the U.S. has repeatedly refused requests from oil companies for escort services. U.S. Navy officials say that deploying warships to this narrow waterway before the threat from Iran subsides would be extremely risky.

Currently, Saudi Arabia, the UAE, Kuwait, Iraq, and Bahrain have collectively cut nearly 7 million barrels per day of oil production to cope with the dual pressures of export disruptions and price volatility. If the blockade continues, the global energy market’s supply gap will further widen.

Even if the conflict ends, resuming passage will take time

The shipping industry generally does not expect the Strait of Hormuz to return to normal navigation in the short term. According to Lloyd’s List Intelligence, over a thousand ships are currently stranded in the Persian Gulf, with more than 600 international trade vessels waiting to depart.

Jerry Kalogiratos, CEO of Athens-based Capital Clean Energy Carriers, bluntly stated that the prerequisite for resuming operations is not only the cessation of hostilities but also that shipowners are confident that the risks to personnel and ships have substantially decreased. “For example, in the Red Sea, even six months after Houthi attacks stopped, shipping has not yet returned to normal. Everything depends on perceptions of safety, and we are still far from that day.”

Even with U.S. military escort, shipping companies’ concerns remain. Bridget Diakun, senior risk and compliance analyst at Lloyd’s List Intelligence in London, pointed out that some shipping companies and oil firms may still refuse to take risks. “Some have explicitly stated that as long as attacks continue and war persists, they will not risk their ships and crews.”

Iran continues counterattacks, causing the Strait to become paralyzed

The Strait of Hormuz is the only outlet from the Persian Gulf, with its narrowest point only about 21 miles wide. Iran has deployed a large number of anti-ship cruise missiles, aerial and maritime drones, as well as mines and submarines along the eastern coast of the strait, posing a comprehensive threat to passing vessels.

Iran’s Revolutionary Guard intelligence has also sent messages to mobile users nationwide, claiming that control over the Strait of Hormuz gives Iran the ability to influence the global economy. On Monday, Iranian Foreign Minister Abbas Araghchi posted on social media that, “Nine days after the ‘epic mistake’ began, oil prices have doubled, and all commodity prices are soaring.”

While the U.S. military has struck over 60 Iranian naval vessels, military analysts note that Iran still maintains a “mosquito fleet” of small manned and unmanned boats. Additionally, Iran’s anti-ship missiles are mounted on mobile launchers capable of firing at very close range, often making detection by defense systems difficult.

U.S. escort efforts face practical constraints

On Tuesday, Trump stated at an event that, “When the time is right, the U.S. Navy and its allies will escort oil tankers through the strait if necessary.” White House Deputy Press Secretary Anna Kelly also reiterated that the President “is fully prepared to provide U.S. naval escort when deemed necessary.” However, U.S. Navy officials say they have not yet received orders for escort missions and warn that executing such operations under current conditions would pose extremely high risks for the ships.

Military analysts question the feasibility of escort missions. Bryan Clark, senior researcher at the Hudson Institute and former Pentagon official, pointed out that the strait is extremely narrow and too close to the Iranian coast, “Drones could be over the ships within seconds, greatly increasing the number of escort vessels needed.” He estimates that each oil tanker might require two warships to defend against threats from the coast and nearby islands.

Chairman of the Joint Chiefs of Staff General Dan Caine said Tuesday that if tasked, the military would deploy appropriate forces. But retired Navy Admiral James Foggo highlighted practical limitations: “These ships are already very busy,” and escort operations face a shortage of available vessels.

Economic impacts spread, and alternative routes are hard to compensate

According to UN trade data, one week before the outbreak of hostilities, 38% of global seaborne crude oil trade passed through the Strait of Hormuz. Saudi Aramco CEO Amin Nasser warned Tuesday that a long-term blockade of the strait would have “catastrophic consequences” for the global oil market and severely disrupt the global economy.

In response to blocked export routes, Saudi Arabia and the UAE are urgently expanding their alternative pipeline capacities. However, reports citing insiders indicate that Saudi Arabia’s measures require diverting crude from domestic refineries, which would further tighten an already fragile refined product market.

Rising oil prices are increasingly putting political pressure on the Trump administration. As domestic concerns over fuel costs and inflation grow, resolving the economic impact of the Strait’s blockade has become a pressing challenge for the White House.

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