Mercuria’s Hormuz Transit Deals Revealed in Legal Filings
Mercuria Energy Group Ltd. has been moving oil through the Strait of Hormuz via government-brokered deals, according to legal filings that provide a rare glimpse into how commodity traders are navigating the closely watched waterway during the Iran war.
The trading house initially argued that transiting Hormuz was impossible without paying an illegal toll and therefore, the Baltic Exchange should have stopped publishing the so-called TD3C index or calculated it based on other similar routes. However, Mercuria’s Chief Executive Officer Marco Dunand revealed in April that the company had managed to move ships out of the Persian Gulf.
Government-Brokered Deals Facilitate Hormuz Transit
In a legal filing dated May 21, lawyers for Mercuria offered further insight into Hormuz transit, which has moved into the shadows since the war began. The filing stated that “Mercuria’s present understanding is that there were approximately 20-24 recorded VLCC transits of the Strait by non-Iranian ships from 1 March 2026 to 19 May 2026.” Over the same period, shiptracking data compiled by Bloomberg show 14 laden, non-Iranian VLCCs exiting the Persian Gulf.
Transits were either made with illegal toll payments or “have been limited, pre-cleared movements arranged on a government-to-government non-commercial basis (including two non-Mercuria managed ships with government ties, carrying Mercuria cargo),” the Mercuria lawyers said. Even though Mercuria concedes that some vessels have transited Hormuz without paying a toll to Iran, it nonetheless argues that such government-brokered deals do not qualify as fixtures on which TDC3 could be based.
Dispute Over TD3C Index Continues
Mercuria also believes that these transits have not been on the standard TD3C route from Saudi Arabia’s Ras Tanura port, inside the Persian Gulf, to Ningbo in China, but instead “have discharged in Fujairah (in the Gulf of Oman), Oman, India or Singapore/Malaysia, waited over a month before transit, and/or completed a ship-to-ship transfer outside the Strait.” The dispute over the TD3C index continues, with Mercuria arguing that the artificially high rate is causing it “hundreds of millions” of dollars of losses.
Since the war started, the TD3C rate has soared, rising to as much as $600,000 a day compared with more typical rates between $40,000 and $100,000. The Baltic Exchange clarified in mid-March that the TD3C rate must continue to be calculated on the basis of shipping from Ras Tanura rather than using rates from Middle Eastern ports outside the gulf, where shipping has continued.
Regulatory Concerns Raised
The spat led to Mercuria writing to UK’s Financial Conduct Authority last month to inform it “of potential breaches” of certain benchmark regulations. The Baltic Exchange has been in contact with the FCA since March this year, its lawyers said in court filings. “The Defendant rejects any suggestion that it is in breach of its regulatory obligations,” a lawyer acting for the Baltic Exchange said in a witness statement.
Original Article: Mercuria Lawyers Say Government Deals Got Oil Through Hormuz — Gcaptain