Iran’s Grip on Hormuz Is Tighter Than Ever After a Month of War

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The near-total closure of Hormuz since then, through threats and attacks, has proved an exceptionally effective asymmetric weapon in Iran’s fight against two of the world’s most powerful military forces. It gives Tehran a means of directly impacting global energy markets and of inflicting acute financial pain — in a way Washington has struggled to counter, despite floating options ranging from insurance support to naval escorts.

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Out of the 110 individual ships that left the gulf this month, more than 36% were sanctioned Iranian ships or part of the so-called dark fleet serving Tehran, data compiled by Bloomberg show. For oil tankers, 21 out of 35 that have exited had direct Iranian ties — but most of the remainder went to nations with whom Tehran has a friendly relationship.

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Until this war, one long-held assumption around Hormuz was that Iran would never attempt to close the strait, for fear of risking its own exports, a vital economic lifeline. In fact, ship-tracking data suggest that Tehran’s oil has continued to flow — almost entirely to China — even as other ships are stranded and producers in the region have been left scrambling for alternatives or forced to stop producing as storage fills up.

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Iran exported roughly 1.8 million barrels a day this month, a nearly 8% increase from its average over 2025, according to figures from data intelligence firm Kpler as of March 26. That likely facilitated hundreds of millions of dollars of oil revenue for Tehran, a Bloomberg News analysis shows.

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In contrast, exports over the same month from Iraq, situated deep in the Persian Gulf, plunged more than 80% compared to 2025 levels, while Saudi Arabia was more than a quarter below last year’s average — even with the help of a pipeline carrying its oil to the Red Sea.

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The impact of Iran’s control is visible in oil markets, with Brent is up close to 60% this month. It is also translating into diplomatic clout, especially with large oil-importing nations. Countries such as India, Turkey, Pakistan and Thailand have have sought Tehran’s approval to get ships through and alleviate a tight energy crunch.

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Even Washington has been forced to make concessions in order to cool prices, waiving sanctions on some seaborne Iranian oil. Buyers have been reluctant, given the risk of getting caught out as restrictions return — but India has taken its first Iranian LPG cargo in almost eight years.

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Other Gulf producers, in the meantime, are rushing to redirect oil flows through alternative routes. 

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Oil traders, shippers and all those reliant on long-established norms, are struggling to cope.

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Overnight, freight rate assessments for a benchmark Middle East-to-China collapsed, prompting the Baltic Exchange to experiment with a new one originating from Oman, as ships divert to the Gulf of Oman and the Red Sea to pick up redirected flows. Local oil benchmarks have become incredibly erratic and unreliable, and no longer provide a true price-discovery function, according to traders and officials. The head of the International Energy Agency has urged European nations to consider decoupling gas and power prices to limit the fallout from the Iran war.

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Insurers are also seeing unprecedented disruption. Almost the entire Middle East is now designated as a war zone by the Joint War Committee, a London-based group of underwriters. As a result, rates to offer premiums for additional war-risk cover for ships in the Persian Gulf and Hormuz have shot up, with those in the gulf at around 1.5% of a vessel’s value, and those for the strait hitting at times 10%.

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Tehran’s toll in theory offers a framework to get traffic moving. In practice, it underscores the reality that even an end to the war will not bring a return to the status quo ante. Many larger shipowners and insurers say they will also struggle to take up the option even if they wanted to, for fear of falling foul of US sanctions.

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“It would be a sort of slippery slope,” said Amanda Bjorn, head of claims at marine insurance broker Cambiaso Risso Asia, “if countries can decide that they’re not going to respect legislation that’s been in place for a good number of years now.”

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