With recent U.S.-Iran tensions escalating again, how do you view the future trend of the shipping crisis in the Strait of Hormuz?

The Strait of Hormuz has never truly reopened. You can track real-time transit volumes through the strait. Over the past ten days or so, daily transit volume has dropped to roughly 12% of pre-war levels. Of those vessels, about 68% are Chinese-flagged. South Korea accounts for only 4%; Japan is categorized under 'Other'. In other words, during this period, China has been the only country actively exporting oil at scale—other nations have failed to meaningfully alleviate the crude oil supply crunch. This stems from the fact that Iranian-controlled waterways only accept vessels from neutral countries; the southern route is not recognized, and insurance premiums are prohibitively high. As a result, the recently signed peace agreement has fallen far short of the 'Donald Trump expectation'. Since I can no longer interpret Trump’s actions using adult logic, I’m forced to resort to childlike reasoning: Trump likely thought: 'I’ll pretend to offer Iran $30 billion—just open the strait first. Once it’s open, Iran won’t be able to maintain perfect control. Then I’ll simultaneously ease oil prices *and* wage asymmetric warfare against them—hit-and-run style—until the moment is ripe for a decisive strike, culminating in a final ceasefire agreement. That way, I save face *and* preserve substance.' But upon signing, he discovered Iran’s control over the strait was remarkably disciplined and orderly.

VLCC shortage, shipowners reaping windfall profits, and a South Korean tycoon’s stunning strategic move

Freight costs have never accounted for such a large share of landed crude oil costs—but their role in the oil market has now dramatically expanded, triggering ripple effects across end buyers. Long-haul shipping routes have lost appeal, prompting buyers to scramble for near-term, short-distance supplies. Soaring freight rates are eroding the economic viability of strategically vital long-distance routes. According to Vortexa vessel-tracking data, U.S.-to-Asia cargo volumes have declined significantly in recent weeks, coinciding with a nearly threefold surge in freight rates. According to reports citing informed sources, a Japanese refiner recently purchased Alaskan crude from ExxonMobil—despite its poor compatibility with the refiner’s processing equipment—primarily because of the shorter voyage. Supply competition in the European market is equally intense. As Brent futures briefly approached $110 per barrel this week, physical Dated Brent spot prices surged above $131, reflecting buyers’ urgent demand for short-haul cargoes. Saudi Arabia’s decision to halt supply to European buyers for next month’s contract cargoes has further intensified sourcing pressure on regional refiners. Even farther afield, Angolan crude—traditionally shipped thousands of miles across oceans to China—has seen sluggish sales. Sumit Ritolia, Senior Modeling Manager at analytics firm Kpler, noted: 'From a long-term perspective, current freight rate levels may prove self-correcting: they will ultimately shut arbitrage windows and suppress demand for the most expensive long-haul crude.' Two key drivers: war-induced disruption and a South Korean tycoon’s century-defining gamble The freight surge is propelled by two core forces. First is the ripple effect of U.S.-Iran conflict. Tankers transiting near the Strait of Hormuz are occupying more vessels and spending longer time there; many others are rerouting around Africa to load in the Mediterranean; and Asian buyers are turning to Americas-based supply to fill Middle Eastern shortfalls. Collectively, these factors have lengthened the effective global tanker voyage distance—and pushed up overall freight rates. Second is a stunning strategic bet by a low-profile South Korean businessman. As reported by Wall Street Insights, prior to U.S. and Israeli strikes against Iran, South Korean shipping magnate Ga-Hyun Chung quietly invested approximately $7 billion to build the world’s largest *owned* tanker fleet—a wager widely regarded as one of the largest single-market bets in maritime history. Chung’s family firm, Sinokor, was founded by his father in 1989, initially operating container shipping services between China and South Korea. According to Eirini Diamantara of Greek brokerage Xclusiv Shipbrokers, Sinokor currently owns over 160 tankers—nearly half of which are VLCCs. Per Kpler data, Chung had already pre-positioned VLCCs near the Strait of Hormuz before the conflict erupted. In the early phase of hostilities, he leased some vessels as floating storage facilities; later, several shifted to short-haul shuttle operations—transferring crude to ports outside the Gulf, where other vessels then carried it onward to Asia. Additionally, Sinokor’s derivatives trading desk concurrently executed paper contracts linked to freight markets—generating further profits amid rising rates. The logic behind the gamble—and historical risks Industry insiders believe the core rationale underpinning Chung’s strategy is this: a single player commanding sufficient fleet scale can influence freight rates by controlling supply-side capacity. This logic rests on several real-world conditions: no dominant market position held by major Greek, Nordic, or Asian shipowners; a large number of tankers absorbed into the opaque 'shadow fleet' transporting sanctioned crude—continuously shrinking mainstream available capacity; and an opaque secondhand vessel market that makes tracking and regulatory intervention extremely difficult.

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