Geopolitical uncertainty has become the single biggest risk hanging over the shipping industry, with vessels and cargo worth roughly $125 billion still stranded in the Persian Gulf, waiting for transit through the Strait of Hormuz to resume, according to Allianz Commercial.
In its latest industry review, published on Wednesday, the insurer said the closure and reported mining of the strait were only the most recent in a run of disruptions to batter global shipping. For owner-managed firms and exporters watching freight costs climb, it is another reminder of how quickly a distant conflict can land on the balance sheet at home.
The developments point to what Allianz calls a “new maritime order”: escalating security risks along the world’s most strategic shipping corridors, established trade routes thrown into disarray, persistent uncertainty, higher risk premiums and a renewed emphasis on resilience over cost efficiency.
Allianz’s data shows that around 1,150 cargo-carrying vessels and as many as 20,000 seafarers are currently stuck in the Gulf. Behind the headline figure sits a human one: crews who have spent months on board, facing the constant threat of attack and the mental strain that comes with it.
Thomas Lillelund, chief executive of Allianz Commercial, said the industry had gone from decades of relative calm, with steady trade flows and largely predictable operating conditions, to a far more complex and volatile environment.
“The Middle East conflict and Strait of Hormuz closure is just the latest in a series of severe interruptions to hit shipowners and cargo operators,” he said. “Resilience, geopolitics and efficiency must be balanced in an increasingly unpredictable world, where the cost of uncertainty is reshaping the shipping industry.”
The strait matters far beyond the insurance market. The US Energy Information Administration describes it as the world’s most important oil transit chokepoint, carrying around a fifth of global petroleum liquids consumption, with very few alternative routes if it closes. That helps explain why disruption there has already pushed oil prices close to $120 a barrel and why the International Energy Agency has warned of a 1.8 million barrel-a-day shortfall this year.
Allianz was at pains to stress that marine insurance has remained available throughout the conflict, albeit at higher hull and cargo premiums. The bigger problem for shipowners, it said, has been less about insurance and more about the basic risk to vessels and crews when sailing through an active conflict zone.
Even if the US and Iran peace agreement holds and the strait reopens, the insurer cautioned, owners will want firm assurances of safe passage, especially if traffic is to return to pre-war levels of up to 140 vessels a day.
“The closure of the Strait of Hormuz sets a dangerous precedent and raises questions around the long-term future of this and other critical chokepoints,” said Captain Rahul Khanna, global head of marine risk consulting at Allianz Commercial.
“What is becoming clear is that we have to pay a price for uncertainty, shifting from ‘just-in-time’ to ‘just-in-case’ supply chains, and prioritising resilience over cost efficiency.”
For UK firms, the lesson is uncomfortably familiar. The pandemic, the Suez blockage and the Red Sea attacks each exposed how exposed lean, just-in-time supply chains can be, and the Gulf crisis is now adding fresh insurance and freight costs to goods that have barely left port. Resilience, once treated as an optional extra, is fast becoming a competitive necessity, which is one reason a growing number of smaller exporters are rethinking their routes to market and diversifying their sales channels to spread the risk.
The full picture is set out in Allianz Commercial’s Safety and Shipping Review, which notes that, even as long-term safety records improve, the structural risks facing global trade are intensifying. For an industry that has long competed on cost, the price of certainty is suddenly the figure that matters most.
