Hormuz shipping traffic falls to seven vessels as oil tops $100
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Ship traffic through the Strait of Hormuz fell to seven vessels in 24 hours, down from a 10-day average of 15, according to Kpler data cited by Reuters. Oil prices jumped above $100 per barrel and were set for their first weekly close above that mark since May. The decline comes as hostilities in the Middle East escalate and prospects for US-Iran peace talks fade.
Key Facts
- Only seven vessels transited the Strait of Hormuz in the past 24 hours, down from a 10-day average of 15, according to Kpler data cited by Reuters.
- Oil prices jumped above $100 per barrel and were on track early Friday to end the week above that mark for the first time since May.
- ING strategists Warren Patterson and Ewa Manthey said oil's resilience reflects a market repricing the duration and severity of the conflict and the mounting threat to regional supply.
- Crude oil and petroleum product volumes exiting the Strait are estimated at about 10 million barrels per day, half of pre-war levels.
Shipping Traffic Collapse
Ship traffic through the Strait of Hormuz slumped to single digits on Thursday, down from a 10-day average of 15 vessels that transited the chokepoint in both directions, according to preliminary vessel-tracking data by Kpler cited by Reuters. Only seven vessels, two outbound and five inbound, transited the Strait of Hormuz over the past 24 hours, per the data, which tracks only ships with positioning systems switched on. Dark transits are believed to be much higher as vessel operators and commodity buyers prefer to switch off their ships' AIS systems to avoid detection and being targeted in the Strait of Hormuz. Owners and energy exporters are becoming increasingly careful navigating through the Strait of Hormuz amid re-escalation of hostilities, strikes on tankers, and the relatively new threat from the Iran-aligned Houthis in the Red Sea, targeting Saudi shipments.
Oil Market Reaction
Oil prices this week jumped above $100 per barrel and were on track early on Friday to end a trading week above the $100-a-barrel mark for the first time since May. Hostilities in the Middle East continue, and the prospects of peace talks between the United States and Iran appear more remote than a few weeks ago. ING's commodities strategists Warren Patterson and Ewa Manthey wrote in a note early on Friday that oil's resilience reflects a market now repricing both the duration and severity of the conflict, along with a clearer recognition of the mounting threat to regional supply. The strategists added that while meaningful volumes are still moving through the Strait of Hormuz, flows remain well below pre-war levels, underscoring how fragile the situation has become.
Supply Volumes
Most estimates put crude oil and petroleum product volumes exiting the Strait at about 10 million barrels per day, of which 9 million bpd is crude. These volumes remain half of pre-war levels, while fuel supply remains severely limited, further weighing on the very tight middle distillate markets.
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