This is a follow-up to this morning’s article on Iran closing Hormuz and the Israel-Hezbollah ceasefire collapse (iran-hormuz-closure-israel-hezbollah-ceasefire). What follows is the next chapter in that story.
The numbers coming out of the Strait of Hormuz are no longer a warning. They are a verdict. Ship tracking data, war risk insurance filings, and live maritime monitors paint a stark picture: the world’s most critical energy chokepoint has been functionally dead for 114 days, and the economic toll is compounding by the hour.
On June 22, the Hormuz Strait Monitor reported just 32 ships underway through the waterway in a 24-hour window, against a normal baseline of roughly 60 vessels per day. Daily deadweight tonnage throughput stands at 3.1 million metric tons, down from a pre-crisis average of 10.3 million, a 70% collapse in cargo-carrying capacity. These are not normal fluctuations. These are the numbers of a closed strait.
The WTO Data Lab’s joint trade tracker with AXSMarine, updated to mid-June, confirms the scale of the devastation. Outbound crude oil shipments through Hormuz have fallen 95% since Iran’s original closure on February 28. The strait normally carries 30-33% of global seaborne crude oil, roughly 17 million barrels per day. That flow has been reduced to a trickle.
The LNG picture is even worse. Liquefied natural gas carrier traffic through Hormuz has fallen 99%, effectively eliminating the roughly 20% of global LNG supply that normally transits the waterway. Qatar, the world’s largest LNG exporter, has seen its primary export route severed. Spot LNG prices now sit at 180-220% above pre-crisis levels, and top importers Japan and South Korea face structural supply scarcity that no amount of spot-market buying from Australia or the United States can fully replace.
Fertilizer-related cargoes, including nitrogen products, phosphates, sulphur, and ammonia, are down 94%. This is not an abstract statistic. The Persian Gulf accounts for roughly 50% of global seaborne sulphur, 25% of urea, 18% of ammonia, and 13% of phosphate shipments. Countries that depend on these inputs for food production are now staring at a fertilizer crunch that will ripple through harvests for seasons to come.
The insurance market has repriced the risk accordingly. War risk premiums for vessels transiting Hormuz now sit at 4% of hull value, up from a normal rate of 0.15%, a 26.7-times increase. Six protection and indemnity clubs have withdrawn cover for the region entirely. The US Development Finance Corporation has established a $40 billion reinsurance facility to backstop what the private market will no longer touch, but capacity remains severely constrained.
Tanker rates reflect the same panic. Very large crude carrier spot rates on the benchmark AG-East TD3C route have hit 380 Worldscale points, a 660% increase over the pre-crisis level of 50. Any remaining crude that does move out of the Persian Gulf comes at a crippling premium that feeds directly into global fuel prices.
The diplomatic timeline only deepens the uncertainty. The Islamabad Memorandum of Understanding, signed by the United States and Iran on June 17, established a 60-day ceasefire framework that included a commitment to reopen the strait toll-free. Iran briefly allowed limited passage, but on June 20 re-declared the closure, citing continued Israeli strikes in Lebanon as a violation of the ceasefire’s conditions. Vice President Vance arrived in Switzerland on June 21 for high-level talks with Pakistan mediating, but as of June 22 the strait remains shut.
The economic cost of the closure is now calculable in hard numbers. Approximately 21% of the world’s oil supply transits Hormuz, representing roughly $1.8 billion in daily value at risk. Japan, which depends on the strait for 90% of its oil imports, and South Korea, at 80%, are in the most acute position. India, at 60% dependency, and China, at 40%, face sustained pressure on refinery margins and import costs. The Brent premium to West Texas Intermediate has widened to $8-12 per barrel, more than triple the normal spread.
Supply chains beyond energy are also fracturing. Container freight from China to the US East Coast has risen 75%. Rates to Northern Europe are up 51%, to the Mediterranean 45%. The global shipping insurance crisis has eroded the risk-bearing capacity of an industry that moves 90% of the world’s traded goods.
Alternatives exist but are limited. The Cape of Good Hope route adds 12 days and roughly $650,000 per voyage in fuel and crew costs, and most major container carriers have suspended Hormuz transits entirely. Saudi Arabia’s Petroline pipeline, running east to west to the Red Sea port of Yanbu, can move up to 5 million barrels per day but is partially utilized and cannot fully replace Hormuz capacity. The UAE’s Abu Dhabi Crude Oil Pipeline to Fujairah is running near its 1.5 million barrel-per-day capacity.
The bottom line is that 114 days of a closed Hormuz have produced a shipping and energy crisis without modern precedent. The data from the WTO tracker, the live monitors, and the insurance markets all tell the same story: this chokepoint is not contested. It is closed. And every day it stays closed adds another layer of cost, scarcity, and risk to a global economy that was already fragile.
The next chapter, diplomatic or military, will determine whether the strait reopens in weeks or months. But the economic data has already written its verdict.