Maritime activity through the Strait of Hormuz has sharply declined amid rising security concerns in the Gulf region, as shipping operators reassess the risks of navigating one of the world’s most critical oil transit routes.
Satellite and vessel-tracking data compiled by maritime analytics firm Kepler indicates a notable reduction in ship movements between February 27 and March 3. The imagery, widely circulated across international media platforms and referenced during a recent Arise News broadcast, shows a significant drop in the number of large vessels passing through the strategic waterway.
The development comes as United States President Donald Trump pledged to deploy naval escorts to safeguard commercial vessels navigating the strait, while also proposing measures aimed at easing insurance burdens for shipping companies operating in the high-risk corridor.
Speaking during the programme, Kepler’s principal freight analyst, Matt Wright, said the proposal to deploy naval escorts may face considerable operational challenges.
“Trump announced on Tuesday evening that they were going to provide lower insurance and escort naval vessels. In reality, there's a lot more complications to this. The threat from Iran still remains very very high and using a naval escort is not actually really going to solve the problem on mass,” Wright explained.
According to him, hundreds of ships are currently unable to leave the Gulf due to safety concerns, despite the strait not being formally closed.
“We've got hundreds and hundreds of vessels trapped within the M East Gulf at the moment. As you said, the straight of is not officially closed. it is closed sort of de facto and that is because the threat to vessels remains very high,” he stated.
Wright noted that more than ten vessels had reportedly been struck in recent days across the Gulf region, highlighting the growing dangers associated with maritime traffic near Iran’s coastline.
“We've had over 10 vessels hit across the Middle East Gulf and Gulf of Oman over the last few days… and the Iranian technology is very sophisticated. They're able to hit these vessels and this is a genuine concern,” he said.
He further cautioned that naval escorts could potentially draw additional attention to commercial ships rather than reduce the risks.
“The use of a naval escort could even be more risky because you could be attracting more attention to those vessels,” he added.
Shipping companies are also grappling with escalating insurance costs as the security environment deteriorates. However, Wright clarified that maritime insurers continue to provide coverage despite the elevated risks.
“Just to be clear, vessels remain insured. The maritime insurance industry is hundreds of years old and has been covering vessels throughout conflicts forever… So there is no risk of vessels not being insured,” he explained.
While coverage remains available, operators must pay significantly higher premiums to sail through the Gulf.
“There will be a premium. Vessels are now going to have to pay more if they're operating in that area,” Wright noted, adding that lower insurance costs alone are unlikely to convince shipowners to resume normal operations.
The analyst stressed that a sustained recovery in shipping traffic will depend largely on diplomatic engagement to reduce tensions.
“The market is fundamentally awaiting a de-escalation… there is fundamentally no mechanism for a sustained recovery in transits of the straight of without that,” he said.
Tracking data referenced during the Arise News interview also revealed that most vessels currently in the Gulf are oil tankers transporting crude oil, refined petroleum products, liquefied gas and chemicals. Cargo vessels carrying commercial goods represent a smaller share of the traffic, alongside passenger and service vessels.
Within the Gulf itself, many ships have continued loading oil cargo but remain unable to depart due to security concerns.
“Within the East Gulf vessels are fundamentally sort of trapped, but we have seen a lot of vessels continue to load,” Wright explained, noting that the region primarily serves as a loading hub for global oil exports.
Meanwhile, dozens of vessels originally destined for Gulf ports have diverted to alternative destinations, including ports along the Red Sea. Some tankers are reportedly loading oil from Saudi Arabia’s pipeline terminals on the Red Sea coast rather than entering the Gulf directly.
However, the alternative route presents its own risks.
“The Red Sea brings with it its own complications… the Houthis in Yemen have been attacking vessels over the last three or four years,” Wright said, noting that renewed threats from the group could further complicate shipping in the region.
Beyond shipping disruptions, prolonged restrictions in the Strait of Hormuz could also affect oil production across major Gulf producers such as Saudi Arabia, Iraq, the United Arab Emirates and Kuwait.
“There is a limit to onshore storage,” Wright explained. “Most of the vessels in the Gulf are full… so there’s a limit to how much more they can keep producing if there are not vessels to come and pick it up.”
If exports remain blocked for an extended period, producers may eventually be forced to suspend operations at certain oil fields.
“That is where we will start to see shut-ins, which is where production from certain fields across the Gulf just have to stop,” he said.
Despite the current disruption, Kepler analysts expect shipping activity to gradually resume once hostilities ease or diplomatic negotiations reduce the threat level in the region.
“We do anticipate that there will be some return to transits… either through mediation or through sustained US attacks on Iran or depletion in Iranian missiles and drones,” Wright stated.
He added that oil prices could begin to fall once shipping lanes reopen.
“We expect crude to drop to sort of the mid-60s by April,” he concluded.