Trump says Hormuz has reopened, but most ships remain stopped

President Donald Trump says the vital Strait of Hormuz has reopened under the terms of a deal reached on Sunday (14) with Iran. Shipping industry sources are not so convinced.

"Ships are beginning to move, many loaded with oil, out of the Strait of Hormuz," Trump posted on Monday (15) on his social media.

But experts who monitor the movement of ships say this is not the case. Uncertainty about the content of the agreement and other risks will likely keep traffic through this critical chokepoint reduced to a minimum for weeks or months.

"The U.S. and Iranian statements are currently vague and do not provide sufficient information on key aspects such as timelines and safe routes," said Jakob Larsen, director of security at the Baltic and International Maritime Council (BIMCO), a leading international organization of ship operators, in a statement.

"Due to a lack of details and a history of overly optimistic assurances, we believe the security situation for the shipping industry remains unstable and we still consider it too risky for ships to begin crossing at this time," he said.

"We advise shipowners to continue carrying out thorough risk assessments and call on all parties to prioritize the safety of seafarers."

Some ships were already passing through the strait - even as the war was in full swing.

"Despite the ongoing naval blockade and the sharp drop in commercial traffic, surprising volumes of crude oil and oil products still appear to be transiting the strait," wrote Natasha Kaneva, head of global commodities strategy at JPMorgan, in a recent client report.

And at other moments of opportunity during previous interim agreements, ships rushed for the exits.

Bob McNally, founder and president of Rapidan Energy Group, told CNN that between 0% and 10% of the normal flow of oil was making it out of the strait most days, which he said helped keep oil prices from rising.

Expectations that the strait is close to reopening caused oil futures contracts to fall to a three-month low on Monday (15).

But Kpler, which monitors ship movements, said its data shows no significant movement for the 220 tankers and nearly 500 ships in total that are stuck in the Persian Gulf.

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"This isn't a surprise as the deal isn't expected to be signed until Friday," said Matt Smith, chief oil analyst at Kpler.

He added that it will likely be three to four months before traffic can be considered "normal."

Most ship operators will want to see other ships pass through the strait before they feel confident doing it themselves, Smith said - and the same goes for marine insurers, which have not yet shown a willingness to insure ships transiting the strait.

But without insurance, ships will be even more hesitant to transit, creating an impasse.

"It's a chicken and egg dilemma," said Smith.

The main marine insurers did not indicate on their websites that they were again insuring vessels in case of attacks. One marine insurer, Skuld, confirmed it had not changed its coverage limitations.

"Any market review of rates, especially war rates that apply in the Strait of Hormuz, would almost certainly depend on the certainty of safe travel," the company said.

BIMCO's Larsen said shipping companies need assurances that mine-free routes have been established. Trump said on Monday that that work is already underway.

"They're doing a little search for some mines they've already found, but... the ships are starting to leave now," Trump said during a meeting with French President Emmanuel Macron at the G7 summit. "On Friday, it will be completely open."

But Larsen said shipping companies also needed clarification on issues such as maintaining a safe distance between ships and naval protection.

"Ships stuck in the Persian Gulf will be interested in leaving as soon as it is safe to do so," Larsen said. "The next step is to assure shipowners that crossing the Strait of Hormuz is not only permitted, but also safe."

CNN's Matt Eagan, Maisie Linford and Donald Judd contributed to this report.

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Source: CNN