Tanker traffic through the Strait of Hormuz has "essentially stopped", as the prospect of a 60-day ceasefire agreement between the United States and Iran remains uncertain, said U.S. sources on Wednesday.
Jorge Leon, head of geopolitical analysis at the energy research firm Rystad Energy, said in a statement on Wednesday that traffic flow "appeared to be at a complete standstill." He noted that this development reflects the market's perception of risk more accurately than any statements coming from the U.S. or Iran.
The reopening of the Strait of Hormuz is reportedly one of the key conditions for the U.S. side, as the waterway is critical to global energy markets. Prior to the U.S.-Iran conflict, approximately one-fifth of global oil and liquefied natural gas supplies passed through this channel.
With the prospect of a full reopening of the Strait of Hormuz becoming increasingly uncertain, global oil prices surged sharply on Wednesday.
Tanker traffic through Strait of Hormuz essentially halted: reports
