Hormuz: Fuel Costs Fall, But Risks And Dangerous Goods Restrictions Remain
Uncertainty continues to surround the Strait of Hormuz after its brief reopening last week was followed by a further closure announced by Tehran. Even if the Strait reopens again in the coming days, it is likely to take several weeks for regional logistics to return to normal.
The good news is that oil prices fell below $80 per barrel last week and, despite the pause in the recently signed US-Iran agreement, have remained around that level. This is significantly below the recent peak of almost $120 per barrel. Lower oil prices should, in time, translate into reduced fuel surcharges. However, bunker and diesel prices typically lag movements in crude markets, so customers should not expect costs to fall immediately.
If the Strait reopens again soon, carriers are still likely to carry out their own security assessments before fully restoring regular schedules and service patterns. They may also wait for confirmation that any remaining navigational hazards, including mines, have been removed. Some carriers have already indicated that even when open, significant cargo restrictions will remain in place across the Persian Gulf, with dangerous goods bookings still subject to limitations.
Cargo insurance costs will also need to be monitored closely. War-risk premiums rose sharply during the disruption and may remain elevated until shipping patterns stabilise and confidence returns.
Looking ahead, questions remain over future Gulf transit costs following Iranian media reports that service fees could be introduced under a joint management arrangement with Oman. Markets will now be watching closely to see whether the ceasefire framework is reinstated and whether the Strait reopens soon.
Until a durable settlement is in place, customers should continue to factor potential volatility into their supply chain planning.
Evolution Forwarding specialises in dangerous goods movements, by air, ocean and road. We provide complete solutions for packing, documentation, compliance and training for dangerous goods products. For further information please email info@evolutionforwarding.com or call 0800 4346244.
