Hormuz and Bab el‑Mandeb Tensions Keep Energy and Ag Freight on Edge Despite Slight Rebound in Traffic

Commodity shipping through the Strait of Hormuz edged higher but remained well below recent averages after a tanker was hit by a mystery projectile, while traffic at the Bab el-Mandeb Strait also softened. The combination of renewed security incidents and an unsettled Iran–Oman management deal is keeping energy, fertilizer and agricultural bulk flows exposed to elevated freight and insurance costs.

According to vessel-tracking data, 10 commodity carriers transited the Strait of Hormuz on Wednesday, up from eight on Tuesday but still below a 10-day moving average of roughly 15 crossings. The modest uptick follows months of disruption linked to the Iran war and U.S.–Iran tensions, which have curtailed flows through the world’s most critical oil and LPG chokepoint.    

Headline

Hormuz Traffic Ticks Up but Stays Depressed as Tanker Attack and Bab el-Mandeb Slowdown Keep Freight Risk Elevated

Introduction

Shipping data providers report that commodity-vessel movements via the Strait of Hormuz rose slightly midweek, even as they remain far below pre-war levels and below short-term averages. Ten visible commodity carriers passed through the waterway on Wednesday, compared with eight a day earlier and a 10-day average near 15, underscoring that a sustained recovery in flows has yet to materialise.     

The fragile improvement comes amid ongoing U.S.–Iran tensions and a tentative framework under discussion between Iran and Oman over the administration of Hormuz shipping lanes. At the same time, a tanker was struck by an unidentified projectile in the strait, briefly catching fire before the blaze was extinguished, highlighting continuing security risks for shipowners and charterers.  

Immediate Market Impact

The latest traffic data confirm that Hormuz remains a constrained corridor for seaborne crude, refined products and LPG, preserving a structural risk premium in regional freight and marine insurance markets. While Wednesday’s 10-vessel count shows some normalisation from recent lows, it is still well below both recent moving averages and pre-war activity, when the strait routinely carried close to one-fifth of global oil trade.     

Security incidents continue to cap risk appetite. UK Maritime Trade Operations (UKMTO) reported a tanker hit by an unknown projectile in the Strait of Hormuz near Khasab, Oman, with a fire subsequently brought under control and crew reported safe. The attack follows a series of strikes and mine threats in recent months and reinforces war-risk surcharges for hull and cargo cover.      

For commodity markets, the net effect is ongoing tightness in prompt physical availability from Gulf producers and greater reliance on alternative routes and origins. Crude benchmarks remain underpinned by the threat of additional disruption, while arbitrage flows in refined fuels, LPG and fertilizer are being reshaped by longer, more expensive voyages.  

Supply Chain Disruptions

The restricted throughput at Hormuz is forcing exporters and importers to re-optimise routing and inventory strategies. Some Gulf producers have increased use of pipeline and overland routes, as well as ship-to-ship transfers outside the immediate conflict zone, but these alternatives cannot fully replicate the capacity of the strait. As a result, loadings from key Gulf terminals remain below potential, and laycan schedules are more volatile.   

Negotiations between Iran and Oman over a phased framework to manage commercial traffic through Hormuz offer a possible stabilising channel, but the deal is not yet fully defined or implemented. Recent comments from Iranian officials suggest a structure in which inbound commercial flows would transit mainly via Iranian waters and outbound voyages partly via Omani waters, while military vessels could be excluded. This ambiguity leaves charterers cautious about forward bookings and contract coverage.    

Simultaneously, traffic through Bab el-Mandeb at the southern entrance to the Red Sea has softened from earlier in the month, with vessel counts slipping below recent highs. Weaker throughput at both chokepoints raises the risk of port congestion downstream in Europe and Asia, as arrival patterns become more lumpy and schedules less predictable for crude, products and dry bulk cargoes.  

Commodities Potentially Affected

• Crude oil: Hormuz remains the primary export route for major Gulf producers; constrained crossings limit barrels available for spot sales and arbitrage to Europe and Asia, supporting prompt differentials and freight-inclusive landed costs.  
• Refined fuels (diesel, gasoline, jet, fuel oil): Medium-range product tankers comprise a visible share of current traffic; attacks and higher war-risk premiums raise voyage economics and could widen cracks and regional spreads.  
• LPG (propane, butane): Dedicated LPG carriers continue to transit the strait, but at lower frequency than before the conflict; Asia-dependent importers may face tighter supply and higher delivered prices if disruptions persist.  
• Fertilizers (urea, ammonia, phosphates): Fertilizer exports reliant on Gulf loadings via Hormuz and Bab el-Mandeb face schedule risk and potentially higher CFR values, especially into South Asia and East Africa, as freight and insurance costs rise. 
• Agricultural bulk (grains, oilseeds, sugar): While volumes are smaller than energy flows, bulk carriers using these routes for Black Sea, Red Sea or Indian Ocean trades could see delays and reroutings that raise freight benchmarks for key agri-bulk lanes.  

Regional Trade Implications

Asian importers heavily dependent on Gulf crude and LPG, including China, India, South Korea and Japan, remain exposed to timing risk and higher landed costs as long as Hormuz throughput lags historical norms. Some buyers are diversifying into West African, North Sea and U.S. Gulf barrels where possible, but these shifts entail longer voyages and limited spare capacity.   

Gulf producers with access to alternative outlets, such as the UAE via the Abu Dhabi Crude Oil Pipeline and Oman’s non-Hormuz terminals, may capture incremental market share where buyers seek to minimise war-risk exposure. Conversely, exporters most reliant on Hormuz transits must navigate higher freight costs and schedule uncertainty when committing to forward sales.   

For agricultural and fertilizer trade, Middle Eastern producers shipping into South Asia, East Africa and the Mediterranean via Bab el-Mandeb could see their competitiveness eroded if freight benchmarks climb further. Import-dependent economies with limited storage are particularly sensitive to even short-lived logistical disruptions and may be forced to accelerate tenders or reallocate origin mixes.  

Market Outlook

In the near term, traders should expect continued episodic volatility around any fresh security incident in or near Hormuz and Bab el-Mandeb, especially if a tanker attack leads to casualties or a prolonged casualty-related blockage. Spot freight for tankers transiting these corridors is likely to remain elevated, with war-risk surcharges embedded into voyage economics until there is a durable security framework in place.   

Key variables to monitor include the progress and terms of Iran–Oman technical negotiations, any formal restrictions on military versus commercial traffic, and changes in AIS ‘dark’ activity patterns that might signal further risk aversion by owners. On the demand side, refiners and fertilizer buyers may continue to reshape term and spot procurement to balance geopolitical risk with feedstock requirements.  

CMB Market Insight

The latest data confirm that, despite a slight uptick in crossings, Hormuz and Bab el-Mandeb remain structurally fragile nodes for global commodity logistics. For now, physical market tightness is driven less by outright loss of supply than by capacity constraints, longer routes and higher risk premia embedded in freight and insurance.   

Commodity traders, importers and exporters should treat current traffic levels as a baseline for continued disruption rather than a sign of imminent normalisation. Strategic planning will need to prioritise diversified origins, flexible routing options and robust risk-transfer arrangements to manage a protracted period of chokepoint volatility.