Skip to content
You can now search across every topic, entity and event.What's new
European Energy Markets
15JUN

Insurers and mines keep Hormuz shut

3 min read
12:23UTC

BIMCO's chief safety officer Jakob Larsen called Hormuz transits "still very risky" on 18 June as foreign-flag traffic stayed away and war-risk cover withheld.

← Back to TTF breaks the floor into the import banJump to analysis ↓
EconomicDeveloping
Key takeaway

Washington lifted the only closure it controlled; insurers and mines keep the strait shut.

Jakob Larsen, chief safety officer at the Baltic and International Maritime Council (BIMCO), the world's largest shipping body, said on 18 June that Strait of Hormuz transits were "still very risky" 1. His verdict came hours after CENTCOM lifted its blockade , and it explains why the lift changed almost nothing on the water.

Foreign-flag commercial traffic stayed away on 18 June. Transit ran at 5 to 10 per cent of pre-war volume, almost entirely Iranian domestic-flag ships, which means fewer than ten vessels a day crossing a channel that once carried over a hundred 2. London war-risk cover, withdrawn in March, had not returned. Premiums for the few crossings still being underwritten had run to 3 to 8 per cent of hull value, up to $8m a passage, against 0.25 per cent before the war 3.

Mines laid across the channel would take 40 to 50 days to sweep at the conservative estimate, up to six months for a full clearance 4, so the oil cannot physically return for weeks even with the blockade gone. The Conwartime clause in standard charter contracts, which lets a captain refuse a passage judged too dangerous, remained triggered across the Gulf.

Three separate actors hold three separate locks on the strait: the US Navy, the London insurers, and whoever laid the mines. CENTCOM opened the naval lock and left the other two untouched. The International Group of Protection and Indemnity Clubs in London covers roughly 90 per cent of ocean-going tonnage, and its war-risk exclusion, not the US fleet, is now the operative closure. Zero new foreign-flag transits followed Trump's signature , because the levers that remained never answered to him.

Deep Analysis

In plain English

On 18 June, the US Navy formally stopped enforcing the blockade. But mines and London war-risk insurers remain in place, keeping commercial tankers out. Insurance companies in London have refused cover for ships trying to cross since 5 March 2026. Mine-laying by Iran's Revolutionary Guard means the water has not been certified safe. The International Group of P&I Clubs requires either a UN Security Council resolution or government certification before reinstating cover. Neither has been issued. As of 18 June, no extra Gulf oil had physically moved.

Deep Analysis
Root Causes

The London insurance market's Hormuz exclusion predates CENTCOM's blockade by five weeks: P&I cover evaporated on 5 March 2026, when Joint Hull Committee guidance and 72-hour cancellation notices took effect. This sequence matters because the actuarial exclusion is independent of the military conflict's trajectory.

The mine dimension compounds the insurance problem. Lloyd's war-risk de-listing triggers on physical certification of cleared water, not on diplomatic agreements. Until the IRGC or a coalition minesweeping operation produces a verified cleared lane, no P&I club can restore cover without breaching its own underwriting standards.

The CONWARTIME clause adds a third layer: even if a ship owner decided to send a vessel regardless of war-risk cover, the captain retains a legal right under Conwartime 2004 to refuse the voyage if conditions are 'too dangerous.' BIMCO's stated position on 18 June gives every captain grounds for refusal that will survive legal challenge from charterers.

Escalation

The gap between the diplomatic and physical states of Hormuz creates conditions for misread signals. Tehran may interpret foreign-flag absence as Western hostility rather than insurance market caution, and may use continued closure as justification for slowing compliance on other MOU commitments. The mine clearance timeline is the structural pacing factor for whether the MOU's 60-day Phase 2 window produces meaningful progress.

What could happen next?
  • Consequence

    Commercial oil and LNG flows through Hormuz will remain near zero for a minimum of 40-50 days after mine clearance begins, assuming the IRGC cooperates with the process, which it has not committed to as of 18 June.

    Short term · Assessed
  • Risk

    If the P&I re-entry condition (UN resolution or government certification) is not met within the MOU's 60-day window, the strait may remain commercially closed even after the nuclear and sanctions provisions are theoretically resolved.

    Medium term · Assessed
  • Opportunity

    Coalition minesweeping operations, if authorised, would be the fastest path to insurer re-entry and commercial flow restoration; this gives the US and European navies a concrete deliverable to offer in Phase 2 talks.

    Short term · Reported
Sources:CNBC·InvestingLive / BIMCO·InvestingLive / BIMCO
Mentions:BIMCO →Jakob Larsen →Iran →Tanker War →Lloyd's of London →London →Operation Earnest Will →US Navy →Iraq →Washington →Tehran →CENTCOM (US Central Command) →CONWARTIME clause →International Group of P&I Clubs →Strait of Hormuz →
First Reported In

Update #132 · Trump lifted the blockade, not the strait

CNBC· 19 Jun 2026
Read original →
Causes and effects
Caused by
500 ships idle as Hormuz stays shut
The zero new tanker transits logged after Trump's order (ID:4270) continued into 18-19 June as the mine and insurer reality persisted.
Occurred 16 Jun 2026
Read story →
This Event
Insurers and mines keep Hormuz shut
The blockade lift removed the one closure Washington controlled and left two that answer to underwriters and minesweepers, not to a presidential order.
Led to
Saudi tankers moved, Hormuz stayed shut
The three Saudi VLCCs made their first movement since the conflict began — the conflict having kept the strait effectively closed since ID:4352.
Occurred 19 Jun 2026
Read story →
Different Perspectives
Spain's LNG terminal operators
Spain's LNG terminal operators
Spain's 9,145 GWh terminal inventory is the largest single stock in the EU LNG network, an option value that can reroute cargoes wherever the winter strip pays best rather than a cavern gas obligation tied to a fixed date. That flexibility matters more as Germany's cavern shortfall pushes more of the winter security question onto import infrastructure.
European Commission
European Commission
Brussels holds the bloc to 90% on a flexible window while Germany, holding roughly a quarter of EU storage capacity, tracks toward missing its own lower 80% figure by 21 points. A national shortfall this size in the anchor market matters more to bloc security than the flexible timetable alone can absorb.
French power exporters and CRE
French power exporters and CRE
French day-ahead rose in step with Germany but by less, reopening a EUR 7-17 premium that makes northward export flows commercially attractive again after the EUR 43.09 discount evaporated in days. CRE separately authorised RTE and Enedis to buy flexibility locally, betting the coming winter's binding constraint is grid congestion rather than a shortage of firm capacity.
TTF trading desk
TTF trading desk
A visible national shortfall like Germany's 21-point gap is a directional signal, not noise, for a desk holding the summer-winter spread. TTF's flat EUR 58-60 range through this week's German price swings says the market has not yet chosen to reprice refill risk into the front of the curve.
German cavern and CCGT operators
German cavern and CCGT operators
German caverns kept buying prompt gas at TTF near EUR 58-60 through the inversion; the wind collapse to 2.4 GW then flipped the spark spread to plus EUR 29 and put turbines back in the same queue. Every day turbines win that bid, injection at a third of the 877 GWh/day pace needed falls further behind.
Slovakia
Slovakia
Slovakia says it dropped its hold-out on the 21st sanctions package only after Ursula von der Leyen personally signed written gas-price and supply guarantees. The Council of the European Union's own 17,238-character release on the package names neither Slovakia nor any guarantee, leaving Bratislava's account unconfirmed by the institutional record.