Hormuz oil exports may not return to pre-Iran-war levels, analysts warn
Petroleum-market analysts say the Strait of Hormuz volumes that prevailed before the Iran war may take years to fully return. Insurance premiums, re-routing decisions and Iran's new naval permission regime have layered structural costs onto Gulf shipping.
CNBC reports that even as oil traffic through the Strait of Hormuz gradually normalises after the Iran war, full return to pre-war volumes within a short window looks unlikely. The strait carries over 20 million barrels per day, roughly one-fifth of global seaborne oil trade, so even small disruptions translate into price volatility on global benchmarks.
According to analysts cited in the CNBC piece, three structural factors are now in play. First, war-risk insurers including Lloyd's have kept premiums elevated above pre-war levels; second, major shipowners that re-routed vessels around the Cape of Good Hope and other alternatives are locked into long-term contracts; third, Iran's new naval regime now requires coordination and permission for each transit. Tehran has also announced that Russian and Chinese vessels will receive preferential treatment.
Brent crude was trading in the $90 range on 30 May, while institutions such as Goldman Sachs project a $92-99 band for the third quarter. This article is informational reporting and not investment advice; consult a licensed adviser for personal investment decisions.
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