Oil Tanker Routes Rerouted as strait of Hormuz Tensions Spike

heightened geopolitical tensions surrounding the Strait of Hormuz are causing important disruptions to oil tanker traffic, with several vessels altering thier courses to avoid the critical chokepoint. This comes amid reports of increased electronic interference and GPS jamming in the region,further exacerbating concerns for maritime safety. The situation has already impacted global oil prices, which briefly jumped approximately 6% on June 22, 2025, with Brent futures reflecting a heightened risk premium [[1]].

Tanker Traffic Diverted Amidst Rising Concerns

Data from Kpler,a firm specializing in industry data,indicates that at least six vessels-including two very large crude carriers,three chemical tankers,and one refined products carrier-diverted from the Strait of Hormuz between early Sunday and early Monday. According to Yui Torikata, senior liquid market analyst at kpler, the situation remains fluid.The affected vessels include:

• Damsgaard (Norway flag)
• South Loyalty (Marshall Islands flag)
• Coswisdom Lake (Hong Kong flag)
• Kohzan maru (U.K. flag)
• Red Ruby (Panama flag)
• Marie C (Marshall Islands flag)

Notably, all six vessels were in ballast, meaning they were either empty or carrying light loads. Though, as of this morning, three of those six vessels -the South Loyalty, Coswisdom Lake, and Damsgaard – have again changed direction and are now heading back towards the Strait of Hormuz. The other three vessels are currently idling off the coasts of Khor Fakkan and Muscat.

Did You Know? the Strait of Hormuz is one of the world’s most strategically crucial chokepoints, with approximately 21 million barrels of oil passing through it daily in 2023, representing about 20% of global petroleum liquids consumption [[2]].

Geopolitical Instability Fuels Shipping Concerns

These disruptions follow a reported U.S. attack on Iranian nuclear enrichment facilities. Adding to the unease, the UK Maritime Trade Operations has reported widespread electronic interference, GPS jamming, and location spoofing, raising significant worries for vessel owners. The recent collision between the Frontline tanker Front Eagle and the dark fleet tanker Adalynn near the Strait of Hormuz, which resulted in a fire on the Front Eagle, has further amplified concerns.

Andy Lipow, president of Lipow Oil Associates, suggests that increasing insurance costs and heightened risks are prompting some owners to avoid the area altogether. Frontline, a major tanker company, has already announced it will no longer except new contracts to sail through the Strait of Hormuz, a decision that other companies are likely to follow. This could lead to a de facto partial supply disruption if there is a lack of tankers to carry the oil that needs to be exported.

Pro Tip: Monitor insurance rates for vessels transiting the strait of Hormuz. A sharp increase can be a leading indicator of heightened risk and potential disruptions.

Iran’s Potential Response and Global Implications

Adding another layer of complexity, Iran’s parliament reportedly voted to block the strait of Hormuz, although a final decision rests with the country’s national security council. British maritime security firm Ambrey has issued an alert that five U.S.-affiliated merchant ships departed the Arabian/Persian Gulf as the U.S. military operations, and no ships publicly affiliated with the U.S. appear to have entered the area as the U.S. strikes. Ambrey believes Iran is “almost certain to respond militarily to the U.S. strikes on nuclear facilities,” potentially including attacks or seizures of US-affiliated shipping.

Jakob Larsen, head of security at Bimco, warns that Iran could attempt a wider disruption of commercial shipping in the Strait of Hormuz through attacks on merchant ships, potentially using anti-ship missiles or drones. The laying of sea mines is another potential, albeit less likely, scenario.

Impact on Global Trade and Shipping

While the Strait of Hormuz primarily impacts oil flows, it also plays a crucial role in regional container trade. Although it handles less than 4% of global container trade, the ports of Jebel Ali and Khor fakkan are critical intermediary points for global shipping networks in the region. The majority of cargo volumes from these ports are destined for Dubai, a major hub for freight movement with feeder services in the Persian Gulf, South Asia, and East Africa.

What measures should international bodies take to ensure safe passage through the Strait of Hormuz? How might choice trade routes mitigate the impact of potential disruptions?