• Traffic through the Strait of Hormuz has increased again, according to Kevin Hassett, White House economic adviser, signaling a potential easing of supply concerns.
  • The uptick, while modest, is being closely watched by oil markets and shipping operators, as even small changes in vessel flow can impact global crude prices and insurance costs.
  • Analysts caution that the rebound remains fragile amid ongoing geopolitical tensions in the region.

Fragile Recovery at a Strategic Chokepoint

Kevin Hassett said Thursday that traffic through the Strait of Hormuz has risen again, offering a glimmer of relief for global energy markets. The strategic waterway, through which about 20% of the world's oil passes, had seen reduced flows in recent weeks due to heightened security risks and navigation restrictions.

“We’re seeing an uptick,” Hassett told reporters, without providing specific data. The remarks come as maritime analytics firms report a slight increase in tanker movements through the strait after a period of congestion at nearby Gulf ports.

Market Impact and Caution

Oil prices edged lower on the news, with Brent crude falling about 1% in early trading. However, traders remain wary. “A few extra tankers per week can shift sentiment, but we’re not out of the woods,” said a shipbroker. Insurance premiums for transits through the strait continue to reflect the risk of seizure or attack.

The increase follows a period of reduced traffic after Iran warned of tighter controls. While Hassett’s comments suggest some normalization, the situation remains fluid. “Without a sustained agreement on safe passage, we could see another sudden drop,” warned a senior fellow at a Washington-based security think tank.

Geopolitical Jitters Persist

The Strait is a flashpoint in US-Iran tensions. Any improvement in traffic would depend on diplomatic progress, which remains uncertain. A spokesperson for the US Navy’s Fifth Fleet declined to comment on specific traffic levels but said it continues to work with allies to ensure freedom of navigation.

🔄 Correction: An earlier version of this article said traffic had risen sharply. While Hassett said it has “risen again,” the increase is incremental.