According to reports, some oil tankers turned or avoided spending even a minute longer than necessary when crossing the Strait of Hormuz on Monday, raising issues about global trade following the United States bombing of Iran.
The Strait of Hormuz is the world’s most vital oil flow choke point and a blockage could lead to surge in prices.
Over the weekend, Iran hinted that it may block the Strait in retaliation, and today, the country’s parliament voted to close it.
At least two supertankers made U-turns at the Strait of Hormuz since the US strikes, vessel-tracking data monitored by Reuters showed on Monday.
Other tankers are waiting outside the Strait before it is absolutely necessary to enter the lane to load oil or liquified natural gas (LNG).
Shipping company Greece, which has a huge oil tanker fleet, has already cautioned the ship owners to rethink if they are entering the Gulf.
Bloomberg reported that according to a circular citing the Greek shipping company, tankers should “reassess passage” via the Strait of Hormuz until the situation normalizes, and wait at safe ports nearby.
The Straight of Hormuz sees about 20 per cent of global daily oil traffic, raising fear that the closure may lead to price at $120 per barrel.
The EIA estimates that 84 per cent of the crude oil and condensate and 83 per cent of the liquefied natural gas that moved through the Strait of Hormuz went to Asian markets last year.
Oil prices initially rose higher this morning following the US strike on Iran over the weekend, but crude has since given back all these gains.
As of press time, Brent Crude was up 0.3 per cent to $77 while the US West Texas Intermediate (WTI) is at $74 per barrel.