Frontline CEO sees Hormuz traffic surge if US‑Iran deal
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- Lars Barstad said he is optimistic that ship traffic through the Strait of Hormuz will resume quickly if the U.S. and Iran reach an agreement not to attack shipping.
- Frontline has five tankers currently stuck in the Persian Gulf because of the Hormuz closure, each capable of carrying up to about 2 million barrels.
- Traffic through Hormuz is currently at five to ten vessels per day, far below prewar levels of 130‑140 vessels daily, but a credible U.S.–Iran deal would cause a material increase.
- Shipping companies are positioning tankers near the Gulf to profit from a potential reopening, but Frontline has not positioned vessels for an opening.
- Joint Maritime Information Center downgraded the Hormuz threat level from "critical" to "severe" on June 7, citing safe transits via the southern route near Oman, though an "elevated risk of attack" remains.
- U.S. Navy helped 200 commercial ships and over 100 million barrels of oil pass through Hormuz in the past month, according to Trump.
- Iran and Oman have discussed imposing transit fees when Hormuz reopens, but the Trump administration opposes a toll system, and the shipping industry dislikes tolls.
Why it matters: Shippers and Gulf exporters stand to gain higher freight rates and quicker oil exports if the strait reopens, while the U.S. and Iran avoid further escalation; however, limited Middle‑East production, logistical bottlenecks, and possible transit fees mean consumers may bear higher costs.
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