Iran has announced the closure of the Strait of Hormuz, citing Israeli attacks on Lebanon and the US failure to fulfill its obligations. Iran's military command warned that further steps would follow if aggression continues.
The US Central Command stated that safe passage through the strait remains in place: on Saturday, 55 commercial vessels carrying 17 million barrels of oil transited the strait. The US continues to ensure freedom of navigation and emphasizes that all aspects of the agreement with Iran must be upheld.
Iran's new body, the Authority of the Strait of the Persian Gulf, has established rules: vessels must follow a route along the Iranian coast, and alternative paths are prohibited. Iran currently provides free insurance to shipowners but may introduce insurance fees in the future.
Following the announcement of a deal between the US and Iran, oil prices fell, but restoring normal supply volumes will take months. The US Strategic Petroleum Reserve has dropped to its lowest level since 1983.
There are serious risks: underwater mines; navigational hazards, including the risk of collisions (especially if a large number of vessels attempt to leave the region); and uncertainty over transit conditions.
According to Eurasia Group analyst Gregory Brew, it is shipping and insurance companies that will decide whether the strait is open. One shipping industry executive said conditions are too uncertain to send vessels from the Persian Gulf. Hapag-Lloyd reported that its ships in the Persian Gulf are ready to depart but are awaiting further signals.
Brew also suggested that Iran's announcement of the strait's closure may be timed to coincide with the start of negotiations with the US.