• Iranian forces target more than 10 vessels, including oil tankers, in the Strait of Hormuz, escalating regional conflict and causing one confirmed death.
  • Major shipping lines suspend transits, rerouting via Cape of Good Hope, leading to a 70% drop in vessel traffic and disrupting 20-30% of global seaborne oil and LNG trade.
  • Crude prices surge 7% amid fears of supply halts, with war-risk insurance spiking and over 150 tankers anchored off Middle Eastern coasts.

Iran's state media IRIB reported that Iranian forces targeted more than 10 vessels, including oil tankers, in the Strait of Hormuz, according to people familiar with the matter. The attacks have intensified in recent days, with a drone boat strike hitting the Marshall Islands-flagged oil tanker MKD VYOM 52 nautical miles off Muscat, Oman, causing an engine room explosion, fire, and the death of one Indian crew member. Twenty-one crew members, including 16 Indians, 4 Bangladeshis, and 1 Ukrainian, were evacuated safely, but the incident has sent shockwaves through global shipping markets.

Shipping has effectively halted in the critical chokepoint, with Maersk (MAERSK-B.CO), Hapag-Lloyd (HLAG.DE), CMA CGM, NYK (9101.T), Mitsui O.S.K., and Kawasaki Kisen (9107.T) suspending Hormuz transits and rerouting vessels via the Cape of Good Hope. This has led to a 70% drop in vessel traffic, disrupting an estimated 20-30% of global seaborne oil and LNG trade, according to industry analysts. Efforts to secure safe passage have hit a snag as war-risk insurance premiums spiked, forcing more than 150 tankers to anchor off the coasts of the UAE, Saudi Arabia, and Qatar. Without a deal to de-escalate tensions, the region risks a full blockade that could trigger a global recession, experts warn.

Crude prices surged in response, with the US benchmark up 7% to $72 per barrel and Brent climbing to $78.4 per barrel, driven by fears of halted Middle East oil supplies. The disruptions have impacted key facilities like Saudi Arabia's Ras Tanura, which closed temporarily, and UAE pipelines, while China, which receives 35% of its oil from the Persian Gulf, has urged enhanced ship protection measures. In a brief statement, an anonymous shipping executive noted, "The risks are unprecedented; we're seeing insurers pull back and crews demanding extra pay, making operations untenable." Attempts to reach Iranian officials for comment were unsuccessful.

Political context adds to the volatility, with US and Israeli strikes targeting Iranian naval bases, drone carriers such as the Shahed Begari, and other infrastructure. An IRGC commander threatened to "set fire" to passing ships, echoing historical conflicts like the 1988 Operation Praying Mantis. Despite these threats, Iran continues loading gas carriers at Kharg Island, defying international pressure. The situation remains fluid, with ongoing negotiations between stakeholders to restore security, but analysts predict short-term oil price volatility and potential further infrastructure hits. This story may be updated as new details emerge.