Around 200 compliant tankers stranded as Strait of Hormuz closure freezes Gulf traffic
AROUND 200 internationally trading, non-sanctioned, tankers, are effectively stranded in the Middle East Gulf after the total halt of vessel movements through the Strait of Hormuz.
According to data from Lloyd’s List Intelligence, the disruption has left compliant tankers either anchored, berthed at terminals, or slow steaming as operators await clarity on security conditions.
The congestion is most acute among very large crude carriers with currently 60 VLCCs inside the Middle East Gulf, with 13 alongside loading terminals. A further 33 vessels are at anchor, while 14 are understood to be slow steaming as owners and charterers deliberate their next move.
The 60 VLCCs represent almost 8% of the global, compliant, VLCC fleet.
In the suezmax segment, 23 vessels remain in the Middle East Gulf. Of these, five are berthed, while the remainder are either anchored or proceeding at reduced speeds pending operational decisions.
The Strait of Hormuz normally carries approximately 20% of global crude oil exports, making it one of the most strategically significant maritime passages in the world.
Transits through the waterway have collapsed since the US and Israel launched coordinated strikes on Iran on Saturday, February 28. Since then, several tankers have reportedly been struck by projectiles near the strait, further deterring shipowners from attempting passage.
Crude tanker transits through the Strait of Hormuz fell to four vessels on Sunday, March 1, versus an average of 24 per day since January, according to Vortexa, with three being Iran-flagged.
“Tracking conditions have become more challenging, with signal jamming and some vessels switching AIS off. Even so, visible tanker movements point to a clear slowdown in larger transits,” said Vortexa analyst Mick Strautmann.
The aframax/long range two class accounts for 30 ships in the region, with eight currently alongside oil terminals. Medium range tankers represent the largest concentration, with 64 vessels present, while long range one tankers total 22 ships.
On Monday, a commander of the Islamic Revolutionary Guard Corps declared that the strait was “closed” and warned that any vessel attempting to transit the waterway would be set “ablaze.”
With tankers unable to exit the Gulf, and new arrivals unable to enter, charter markets are bracing for further volatility as traders assess alternative supply routes.
Of the effectively stranded VLCC fleet in the Gulf, South Korea’s Sinokor appears to be the most exposed shipowner.
Lloyd’s List Intelligence data shows six VLCCs being attributed to Sinokor ownership, the highest tally among all shipowners.
Two of those vessels were recently added to its fleet as part of an aggressive expansion drive that has seen the company acquire at least 50 secondhand, mid-aged VLCCs from prominent European owners in recent months.
The buying spree has significantly expanded Sinokor’s presence in the crude tanker segment, but has now also increased its exposure amid the crisis.
Other major shipowners with multiple VLCCs caught in the Gulf include Japan’s Mitsui OSK, which has five ships in the area, and Saudi Arabia’s BAHRI, also with five vessels positioned in the region.
Beyond VLCCs, in the suezmax segment, Greek shipowners are heavily represented. According to data from Lloyd’s List Intelligence, both Dynacom Tankers Management and Polembros Shipping each have three suezmax tankers stationed west of the Strait of Hormuz as of today.
Prior to the attacks, shipbroker BRS noted there had been growing potential for Asian refiners to source crude supplies closer to home, chiefly from the Middle East, rather than relying on Atlantic Basin cargoes, largely to reduce freight costs. That dynamic now appears set to shift dramatically.
“There is now likely to be a scramble for alternative non-Middle Eastern barrels which should see available tankers chartered regardless of the freight costs. It could also lead many charterers to look to secure available tonnage under long-term time charter,” BRS said.
BRS highlighted that VLCCs, which transport the largest share of crude exports from the Gulf region, are expected to be among the most affected segments. Long range two product tankers, responsible for hauling the bulk of clean petroleum products, could also see significant market disruption amid concerns surrounding the Strait of Hormuz.
“Considering the shortage of available, alternative refined product supplies, the impact on clean tanker markets is harder to gauge. However, there should be a scramble for tonnage, although this is unlikely to be to the same extent as for crude tankers and may be slightly nuanced depending on region,” said BRS.
“All told, and considering the fluidity and uncertainty of the situation in the Middle East, perhaps the most likely immediate-term outcome for tanker markets is an injection of unprecedented volatility.”
In the LR2 segment, Greek owners dominate and include vessels owned by Dimitris Prokopiou’s Centrofin, the Peraticos family’s Pleiades Shipping and Neda Maritime Agency.
But China’s Cosco stands out as the single most exposed player, with three LR2s currently positioned in the Gulf.
Some 16% of tanker capacity, of ships of above 27,000 dwt, currently in the Gulf is attributed to Greek shipowners provided by 39 ships.
This is followed by Japan with 18 tankers, which provide 12.5% of dwt tonnage, and South Korea (12 vessels) and China (18 ships) with 12.2% and 7% of dwt respectively.
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