Hormuz Strait Shipping Disruptions Reach Critical Levels
The recent escalation of military operations in the Middle East has led to a significant decrease in oil shipments through the Strait of Hormuz, a critical waterway for global energy trade.
According to Kpler, only three vessels transited through the strait on June 26, compared to 12 the day before. This is a stark decline from the average of 17 vessels that have been passing through the strait over the past 10 days.
The increased tension and strained relations between countries in the region have made it more challenging for oil shipments to pass through the area. Executives are warning that the market is becoming less able to tolerate disruption, with an estimated 1.6 billion barrels of crude and condensates removed from the market since February.
The impact on natural gas has also been significant, particularly in the decline of liquefied natural gas (LNG) shipments. The loss of Qatari LNG has been estimated at around 36 million tons, with cheaper LNG allowing it to flow from the Middle East to Europe instead.