Gulf shipping crisis deepens as tankers stranded for fifth day
The U.S.–Iran war widened on Wednesday after a U.S. strike hit an Iranian warship off Sri Lanka, deepening a crisis that has paralyzed shipping through the Strait of Hormuz for a fifth day and choked off vital Middle East oil and gas flows.
Tanker traffic still stuck, production cuts widen
At least 200 ships, including oil and liquefied natural gas tankers as well as cargo ships, remained at anchor in open waters off the coast of major Gulf producers including Iraq, Saudi Arabia, and Qatar, according to Reuters estimates based on ship-tracking data from the MarineTraffic platform. Hundreds of other vessels remained outside Hormuz unable to reach ports, shipping data showed. The waterway is a key artery for around a fifth of the world’s oil and LNG supply.
Vessels hit in area since Iran conflict began
At least eight vessels have suffered damage in the area since the Iran conflict began on Saturday. On Wednesday, the Maltese-flagged container ship Safeen Prestige was damaged by a projectile as it sailed toward the northern end of the Strait of Hormuz, prompting the crew to abandon ship, British navy agency UKMTO said.
Qatar shuts down gas liquefaction
Qatar will fully shut down gas liquefaction on Wednesday and won’t return to normal production and exports for at least a month, two sources familiar with the matter told Reuters. Gas giant QatarEnergy declared force majeure on shipments of LNG after attacks on its production facilities.
Iraq cuts oil production
Iraq cut its oil production as the country ran out of storage, unable to load it on tankers. Saudi Arabia, the UAE, and Kuwait were also struggling to load oil but it was not yet clear if they cut output.
Rare tanker transit amid shipping freeze
Despite the gridlock, a rare voyage took place on Tuesday when the Suezmax tanker Pola sailed through the Strait of Hormuz to the UAE to load crude, according to industry sources and LSEG ship-tracking data. The Pola had switched off its AIS transponder late on March 2 as it approached the Strait and reappeared the next day off Abu Dhabi.
Trump pledges insurance and navy escorts
Trump on Tuesday said he had instructed the U.S. International Development Finance Corporation to provide political-risk insurance and financial guarantees for maritime trade in the Gulf. “No matter what, the United States will ensure the free flow of energy to the world,” he wrote in a social media post.
Commercial war risk insurance costs soar
Commercial war risk insurance costs have soared at least five-fold in recent days. “Rates have increased from levels that owners and charterers will be used to,” said Angus Blayney with insurance broker Gallagher. “The cost will vary depending on the vessel type, cargo, and routing, however marine insurers are very much continuing to provide cover.”
Original Article: Gulf shipping crisis deepens as tankers stranded for fifth day, US sinks Iranian warship | Reuters — Reuters