Gulf Conflict Update: Iran Opens 'Controlled Corridor' at the Strait of Hormuz, Supply Chains Remain Strained

Source: The Sunday Guardian

After nearly a month of a near-total blockade driven by the ongoing Iran-Israel-US conflict, vessel traffic through the Strait of Hormuz has registered cautious growth as Iran begins implementing a selective "controlled transit" system. Nevertheless, crude oil prices remain highly volatile, and major ocean carriers continue to reroute their fleets.

Maritime data indicates that at least 20 vessels have successfully transited the strait since March 28. Notably, on March 30 alone, six vessels broadcasting Automatic Identification System (AIS) signals were confirmed to have completed the transit. However, this vital waterway remains strictly closed to vessels from the US, Israel, and their Western allies. Overall traffic volume is still down over 90% compared to pre-conflict levels.

Which Countries Are Permitted to Transit the Strait of Hormuz?

Iran's Foreign Minister announced that vessels from China, Russia, India, Iraq, and Pakistan are now permitted to transit the strait. Malaysia and Thailand have also secured transit rights following bilateral negotiations with Iranian authorities.

In recent days, several key vessels have made successful transits. Two COSCO mega-ships, the CSCL Indian Ocean and CSCL Arctic Ocean, departed the Gulf on March 30. Indian-flagged Liquefied Petroleum Gas (LPG) carriers BW TYR and BW ELM also arrived safely at the Port of Mumbai on March 31. On the same day, the Thai oil tanker Pola, carrying one million barrels of crude, successfully exited the strait heading for a domestic destination.

What Risks Are Shipping Lines Facing?

Despite the uptick in traffic, severe security threats remain ever-present. On March 31, the Kuwaiti oil tanker Al Salmi was attacked by an Iranian drone while at anchorage at the Port of Dubai, sparking a fire and raising concerns over a potential oil spill.

To evade detection, many vessels continue to operate "AIS-dark" (disabling their tracking transponders) or navigate alternative routes through Iranian territorial waters north of Larak Island. These lurking hazards mean maritime giants like Maersk and Hapag-Lloyd are refusing to gamble, steadfastly routing their vessels around the African continent rather than risking the chokepoint.

Macroeconomic Impacts on the Global Energy Supply Chain

Brent crude prices sustain their volatile trajectory, having peaked at 126 USD/barrel earlier this month. Although prices have cooled slightly, the Hormuz blockade has triggered the largest global oil supply disruption shock since the 1970s.

Prior to the conflict, the Strait of Hormuz handled approximately 20% of the world's Liquefied Natural Gas (LNG) and oil supply. The near-total closure has forced nations to tap into emergency reserves and aggressively scramble for alternative sourcing.

In India - which imports roughly 12-15% of its crude via the Strait of Hormuz - the Ministry of External Affairs confirmed the safe arrival of four LPG carriers in recent days. The government has also slashed excise duties on petrol and diesel to create a buffer protecting domestic consumers from price spikes. Indian refiners have resumed purchasing Iranian oil under a temporary waiver from the US. According to trader reports, Urals crude is now selling at a steep premium rather than its pre-war discount.

Deadlock on the US-Iran Diplomatic Chessboard

This traffic recovery unfolds amidst urgent diplomatic efforts. President Donald Trump has delayed strikes on Iran's energy infrastructure until April 6, stating that negotiations with Iran are progressing "very well."

In stark contrast, Iranian officials have publicly dismissed all reports of negotiations. Foreign Minister Abbas Araghchi firmly asserted that Tehran "does not intend to engage."

Operating through Pakistani mediators, the US has reportedly tabled a 15-point ceasefire plan, demanding the complete reopening of the strait to all commercial shipping and a permanent halt to nuclear enrichment.

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Source: Phaata.com (According to The Sunday Guardian)

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