When Will Shipping in the Strait of Hormuz Return to Normal? Key Analysis Explained

U.S.-Iran War Key News

Central News

(Taipei, Washington, 17th, comprehensive international news) The United States and Iran have reached a memorandum of understanding, committing to gradually reopen the Strait of Hormuz in the coming months. Since the two countries went to war in February this year, this globally vital oil and natural gas shipping route has been largely blocked. However, restoring shipping traffic to pre-war levels still faces major challenges.

Sixty percent of the world’s crude oil exports come from Persian Gulf countries such as Saudi Arabia and Iraq. The Strait of Hormuz, located between Oman and Iran, connects the Persian Gulf, the Gulf of Oman, and the Arabian Sea, occupying a strategically vital position that controls the maritime lifeline of energy exports.

Thirty percent of the world’s oil products are shipped through the Strait of Hormuz, with 80% of that volume heading to Asian countries. This route serves as the primary crude oil import channel for Asian nations such as China, Japan, South Korea, and Singapore. Over 80% of Japan and South Korea’s crude oil, and more than 40% of China’s, originate from the Persian Gulf region.

According to Bloomberg, prediction market platform Kalshi estimates a 51% probability that shipping traffic will return to normal by August 1, and a 68% probability by September 1. Below is an analysis of the main obstacles:

● Mine Threat

Iran is believed to have laid naval mines in the commonly used shipping lanes of the Strait of Hormuz. The mine threat has forced vessels to reroute along Iran’s coastline or closer to Oman. The southern route, monitored by the U.S. military, has seen a slight rebound in oil shipments. However, the capacity of these alternative routes to handle full shipping volumes remains untested.

Clearing mines from the central channel would help restore normal shipping flows. However, it remains unclear who will be responsible for this operation and how mine-clearing vessels will be protected. The clearance operation itself could take several weeks.

● Attack Risk

In addition to mine threats, further violent attacks could still endanger ships and crew. The U.S. and Iran reached a fragile ceasefire agreement on April 8, but hostilities have not fully ceased. According to statistics from the United Nations’ International Maritime Organization (IMO), the conflict has resulted in at least 14 crew fatalities and 46 incidents of ship damage.

Even under improved conditions, commercial ship crews often remain hesitant to operate in conflict zones. The shipping industry seeks clear assurances from both the U.S. and Iran that hostilities have ended. Nevertheless, several shipowners note that some crew members may still refuse to return to the Persian Gulf, potentially reducing the number of vessels willing to collect cargo in the region.

● Unclear Leadership

Before the war, freedom of navigation in the Strait of Hormuz was taken for granted, with only minor exceptions. Whether this can be maintained going forward remains uncertain. Iran’s semi-official Fars News Agency reported that management of future “navigation services” in the strait will be decided jointly by Iran and Oman.

Several shipowners told Bloomberg News they would prefer not to be forced to coordinate with any authority, especially not with the Iranian regime, which remains under U.S. sanctions. They emphasize that these waters should be governed by the principle of freedom of navigation.

The Baltic and International Maritime Council (BIMCO), the world’s largest shipowners’ industry group, stated that it is essential to clearly define who will coordinate passage in the future. The organization suggests that a UN-related body or a neutral country could serve as a coordinator.

● Possibility of Toll Fees

It remains unclear whether ships passing through the Strait of Hormuz will be charged tolls in the future. U.S. President Donald Trump has stated there will be no fees, while Iran has indicated that the period of free passage for vessels will end 60 days from now.

The IMO stated in April that there is no legal basis for collecting tolls; the U.S. has previously said that paying such fees could constitute a sanctionable offense. As a result, shipowners are deeply concerned that paying fees to Iran could lead to being blacklisted by the U.S. However, at least one senior U.S. official has acknowledged that fee payments could become a future option.

Major energy companies are likely to oppose any toll measures. Chevron Corp. CEO Mike Wirth said in a May interview with Bloomberg Television that Chevron would not consider paying fees to transit the strait under any circumstances.

● Stalled Oil and Gas Production

Stalled oil and gas production may be the biggest obstacle to restoring trade flows through the Strait of Hormuz.

Due to the strait’s blockade, some oil and gas production has halted because exports are no longer possible. Even when oil wells are deliberately shut down, their efficiency decreases, leading to long-term operational losses. In other cases, production has been forced to stop due to war-related damage. According to energy research and business intelligence firm Rystad Energy, rebuilding the region’s oil and gas infrastructure will cost approximately $42 billion.

During the restart of infrastructure, oil tankers that were previously rerouted or temporarily idled must be redeployed. According to Rystad analysts, this will take about two months. They believe that as oil fields resume production, output in the region will increase significantly in August and September, reaching about 85% to 90% of pre-war levels by early Q4 2024, with full recovery to pre-war levels expected by January 2027. (Translation: Hsu Chung-che) 1150617