Shipping Lines Adrift in Uncertainty: When Will the Strait of Hormuz Truly Reopen?

Source: Amirhosein Khorgooi / ISNA qua AP / USNews

Hundreds of commercial vessels are still stuck in the Persian Gulf, with costs accumulating steadily — that is the reality shipping lines have been grappling with for over two months since the Iran war erupted. The uncertainty over when and how the Strait of Hormuz might reopen is pushing the entire maritime industry into a state of continuous flux.

"Project Freedom" — Launched, Then Suspended

On Sunday, President Donald Trump announced "Project Freedom" — an initiative allowing the United States to "escort" vessels safely through the strait. Two ships completed the passage under the program. But by Tuesday, Trump abruptly suspended the effort to create space for negotiations aimed at ending the war.

Meanwhile, the risks to vessels and crew have not diminished in the slightest. French carrier CMA CGM confirmed on Wednesday that one of its container ships had been damaged after coming under attack while attempting to transit the strait. Fears over Iranian speedboats and drones are keeping the world's largest shipowners and operators firmly on record: the strait remains too dangerous for normal operations.

Sean Pribyl, a maritime attorney at Holland & Knight in Washington D.C., was blunt in his assessment: "Ultimately, it's still going to come down to the core issues of risk and safety" — and those are the calculations cargo owners are being forced to weigh. He added: "It seems like we're still very far from any return to free navigation and free passage through the strait."

Cargo, Crude, and Crew — All Stuck

Before the war, between 100 and 135 vessel transits passed through the Strait of Hormuz daily, according to data from research firm Lloyd's List Intelligence. That figure has now dwindled to a trickle, as Iran requires all vessels to undergo a vetting process run by the Islamic Revolutionary Guard Corps (IRGC) before being granted safe passage. The process compels ships to travel along a route hugging the Iranian coastline, disclose information about their crew and cargo, and in some cases, pay a fee. The paradox is stark: making payments to the IRGC exposes shipping companies to the risk of violating U.S. and EU sanctions — both of which have officially designated the IRGC as a terrorist organization.

The stranded cargo includes crude oil, petroleum products such as fertilizers, and thousands of crew members. U.S. Air Force General Dan Caine, Chairman of the Joint Chiefs of Staff, stated that as of Tuesday, more than 1,550 vessels carrying approximately 22,500 crew members were present inside the Persian Gulf.

To intensify pressure on Tehran, the U.S. Navy is currently enforcing a blockade of Iranian seaports, deploying forces outside the strait in the Gulf of Oman and the Arabian Sea.

Marine Insurance — A Problem Without a Solution

Holland & Knight's Pribyl noted that shipping companies and marine insurers are likely still in the middle of a comprehensive assessment of the situation at the strait. Commercial vessels are typically covered under two main categories: Protection and Indemnity (P&I) insurance — which covers hull assets and third-party liabilities — and, in the context of armed conflict, war risk insurance, which covers damage and losses arising directly from acts of war.

With conditions on the ground still carrying too many unpredictable variables, the equation between operational risk, insurance costs, and sanctions compliance pressure is placing the entire shipping industry in one of its most complex dilemmas since the Red Sea crisis.

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Source: Phaata.com (According to USNews)

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