Shipowners cautious on US-Iran Hormuz deal, await clear assurances

Key facts

• European leaders cautiously welcomed President Donald Trump's Iran ceasefire deal.
• US President Donald Trump announced a deal with Iran to reopen the Strait of Hormuz.
• Shipowners remain cautious and are seeking clearer assurances on safety before transiting the Strait of Hormuz.
• The Strait of Hormuz, crucial for oil transport, has been largely shut since the war began.
• There have been 57 recorded incidents affecting vessels in the Mideast Gulf region since February 28.

European leaders have cautiously welcomed President Donald Trump's announcement of a ceasefire deal with Iran aimed at reopening the Strait of Hormuz. However, freight market participants are remaining cautious, preferring to seek clearer assurances on the safety of ships transiting the critical waterway before resuming normal operations.

President Trump announced on June 14 that an agreement with Iran was complete, ordering an end to the US naval blockade in conjunction with the reopening of the strait. This waterway, through which a quarter of the world's oil traveled before the recent conflict, has been largely shut since February 28 as Iran tightened control and used access as leverage. Security risks have escalated, with 57 recorded incidents affecting vessels in the Mideast Gulf, the Strait of Hormuz, and the Gulf of Oman since February 28, according to the UK Maritime Trade Operations as of June 11.

Shipowners are hesitant to reposition vessels to the Mideast Gulf, citing the risk of the situation changing quickly and the potential for unattractive freight rates. They have adapted by finding new trade routes and are unlikely to benefit from a "first-mover advantage." A sustained recovery in cargo volumes is expected to gradually raise freight rates, with many choosing to wait and observe market reactions. Mines in the area also pose a threat to vessel transits. A gradual return to the region is possible if security conditions stabilize and cargo flows resume, with any recovery expected to be measured rather than immediate.