A New “Shadow Fleet” – Blockade Running
Much as the Urals discount inspired the creation of Russia’s alleged ~1,000-ship-strong “shadow fleet”, recent oil prices may motivate shipowners to risk the Strait of Hormuz. We ran the numbers!
Strait of Hormuz closure – A mighty disruption to global oil markets
The closure of the Strait of Hormuz has long been considered the “nightmare scenario” for oil markets. Prior to the Iran crisis, approximately 20 million barrels per day (mmbpd) of oil were exported from Middle Eastern OPEC countries to the rest of the world, roughly one fifth of global demand.
On February 28, 2026, the first day of military operations, Iran declared that the Strait of Hormuz was closed. This was followed very quickly by announcements from Lloyds of London and other maritime insurers that either they were cancelling war risk insurance for ships transiting the waterway, or increasing rates dramatically. Unsurprisingly, the passage of ships carrying oil and all other cargo slowed dramatically, coming almost to a halt in just a few hours.
