Trump's Hormuz gamble leaves shipping lanes empty despite ceasefire

Trump's Hormuz gamble leaves shipping lanes empty despite ceasefire Iran reopened the strait officially, but insurance and political demands keep tankers idle. As of mid-May (2026-05-17), maritime traffic through the Strait of Hormuz remained at a near-standstill even though Iran had formally agreed to reopen the waterway for safe passage, Argus Media reported. The obstacle is insurance. Underwriters are refusing to cover vessels transiting the strait, and new geopolitical demands from Washington have deepened the paralysis.⁵ The strait is the world's most important oil chokepoint. In 2022 its flow averaged 21 million barrels per day, about 21% of global petroleum liquids consumption, according to the EIA. With underwriters on the sidelines, close to a fifth of the world's oil supply sits in limbo even after a ceasefire.^1,5 Donald Trump set this in motion. Having made a mess of global energy markets by attacking Iran, he has been pressing America's allies to help open the strait, the Economist reported. The fallout has spread to gas. Asia LNG prices surged 143%, crossing $25/mmBtu, while damage to Qatar's liquefaction infrastructure has removed about 12.8 million tonnes per annum of supply, with recovery timelines running up to five years, databiztimes reported.^2,4 Japan and South Korea are watching warily. Polling shows 80% of Japanese oppose the conflict, yet Washington wants its Asian allies to help secure the strait, the Economist reported. The region has the most at stake: 82% of the crude oil and condensate that moved through Hormuz in 2022 went to Asian markets, EIA data show.^2,1 China's worry runs wider. Beijing has complained that "certain major powers have consistently meddled in and attempted to control shipping lanes," a veiled reference to fears that the United States might blockade Chinese trade, the Economist reported.³ The episode has exposed a vulnerability in American maritime capacity. Chinese-built container ships have carried US manufactured goods; South Korean yards built the LNG carriers that shipped American gas; and the US Navy now leans on Japanese and South Korean shipyards for maintenance and repairs, Foreign Policy reported. Market forces built that efficient arrangement. Those same forces will not rebuild domestic shipbuilding in a crisis.⁶ Some bypass capacity exists. Saudi Aramco's East-West pipeline can move up to 7 million b/d, and the UAE's Fujairah line carries 1.5 million b/d to the Gulf of Oman, the EIA notes. It estimates roughly 3.5 million b/d of unused pipeline capacity could skirt the strait in a disruption. That still leaves the bulk of the 21 million b/d flow exposed.¹ The insurance impasse shows no sign of breaking. Even with a fragile two-week ceasefire in place, the risk premium on Hormuz transit has not reset, according to Argus Media. Should the truce fracture, or Washington's pressure on Asian allies produce political division rather than a naval coalition, the strait could stay a bottleneck for months. The market that built the world's most efficient shipping system cannot, on its own, rebuild the shipyards or the insurance cover a crisis demands.^5,6