Strait of Hormuz traffic plunges as US, Iran resume fighting

Shipping traffic in the Strait of Hormuz has significantly decreased due to renewed fighting between the United States and Iran. Since Tuesday, no large vessels have been broadcasting their location via the US-coordinated route, and traceable crossings have "effectively ground to a halt." This decline in traffic, from approximately 130 daily transits before the conflict to just five on Wednesday, reflects a cautious posture by shipping lines amid an elevated threat environment. Iran has reported explosions following US strikes on its targets, while Iranian officials claim to have struck US military assets in retaliation for attacks on vessels in the Strait. Despite this turmoil, Brent crude oil prices have remained largely steady, though analysts anticipate upward pressure on prices as inventories dwindle.

Since a US-Iran memorandum of understanding (MoU) on June 17 aimed to restore shipping through the Strait of Hormuz, the waterway's future is uncertain. Despite over 500 ships passing, many remain stuck. In recent days, three ships were attacked, with Iran accusing them of attempting passage without approval. The US responded with escalating strikes on Iranian soil, including Tehran, while Iran fired missiles and drones at Gulf nations. US President Trump stated the truce is "over," raising fears of renewed war, and Iran has threatened to close the strait again. The Strait of Hormuz is a vital chokepoint for global oil and gas, with approximately 20 million barrels passing daily before the war. At least five commercial vessels have been attacked in or near the strait since the ceasefire.

Shipping traffic through the Strait of Hormuz has significantly decreased following recent attacks on vessels. On Wednesday, only 23 tankers and cargo ships transited the waterway, a sharp drop from 47 the previous week. These attacks occurred after a US-Iran deal aimed at reopening the strait, which had seen increased traffic following its signing. The incidents involved ships using a US-recommended route through Omani waters, prompting Iran to reiterate its claim that its own routes are the only safe option. The US responded with strikes on Iranian targets, accusing Iran of violating the truce, while Iran accused the US of breaching the agreement. This latest violence has caused a halt in traffic on the Omani route, with no ships using it on Wednesday.

A prolonged conflict between the US and Iran, particularly concerning the Strait of Hormuz, poses a significant threat to vital undersea internet cables in the Middle East. Iranian state media has highlighted the strait's dual role as a critical route for oil shipments and internet communications. Damage to these cables could result in a "digital catastrophe" and substantial financial losses for southern Persian Gulf nations, which depend on them for over 90% of their connectivity. This vulnerability has emerged as a quiet concern amidst the ongoing focus on oil supply disruptions.

The Panama Canal has become a focal point of escalating US-China tensions, with both nations accusing each other of politicizing global shipping. The US and its regional allies claim China has detained Panama-linked ships, calling it a deliberate attempt to manipulate maritime trade. China has vehemently denied these accusations, labeling them hypocritical and accusing the US of undermining sovereignty. Analysts warn that any disruption to the canal could significantly impact global trade, causing supply bottlenecks and market volatility. This dispute occurs amid heightened tensions over the Strait of Hormuz, suggesting a broader trend of major powers contesting control of vital shipping lanes and potentially challenging existing maritime laws.

A "shadow fleet" of vessels successfully bypassed a US naval blockade of the Strait of Hormuz between March 1 and April 15, 2026, following an escalation of conflict involving Iran. This covert network of ships utilized fake flags, shell companies, and disabled tracking signals to navigate the vital waterway, which is crucial for global oil transport. The blockade was imposed by the United States on April 13 after Iran threatened to block enemy ships. Despite the blockade, an investigation tracked 202 voyages by 185 vessels through the strait, demonstrating Iran's ability to evade international maritime restrictions. This operation occurred amidst fears of attacks and disruptions to navigation in the strait, a chokepoint for a fifth of the world's oil.