Shippers hold their breath as US-Iran deal promises to reopen Hormuz

The most consequential development in maritime trade this week unfolded not at a US port but in the narrow waters of the Strait of Hormuz, where months of conflict have throttled one of the world's most vital oil arteries.

Washington and Tehran announced a framework agreement to end their war, lift the US naval blockade of Iran and reopen the strait, with a memorandum of understanding expected to be signed in Switzerland on Friday 19 June. President Trump said on 14 June that he had authorised a "toll-free" reopening of the waterway. Global oil prices fell about 4 per cent in response.

The shipping industry welcomed the news, but with conspicuous caution. Vessel traffic through the strait had not visibly changed by mid-week, according to AIS tracking data, suggesting owners are waiting for the signing and for firm details on mine clearance before committing to transits. Those vessels still moving have hugged shipping lanes near Iran's Larak and Qeshm islands rather than the traditional central route.

The disruption has left a heavy mark. An estimated 155 tankers were in the Mideast Gulf area as of 15 June, down from 201 at the end of May, while VLCC freight rates from the Gulf to China had spiked 24 per cent in a single session as war-risk premiums climbed. Analysts at Kpler estimate traffic could recover to roughly half of pre-conflict levels within 30 days of implementation, with some 118 stranded tankers able to exit within a fortnight.

Few expect a swift return to normal. De-mining, insurance normalisation and rebuilt confidence will take weeks, and one analyst cautioned that full pre-conflict volumes are realistically a 2027 story, contingent on the agreement holding without incident.