Iran shuts Hormuz southern route after tanker explosions
Two oil tankers caught fire in the Strait of Hormuz as Iran's military closed the Omani shipping corridor, threatening a chokepoint that handles a fifth of global oil and LNG supplies.
Two oil tankers were brought to a halt by explosions and extensive fires in the Strait of Hormuz on July 21, according to Iran’s Islamic Revolutionary Guard Corps. Rescue units evacuated the crews of both vessels. The incident marks the latest disruption in a critical maritime chokepoint that has become nearly impossible to navigate.
At least six tankers have been damaged in recent days by projectiles or naval mines. The waterway typically handles about 20% of the world’s oil and liquefied natural gas supplies. Its effective closure represents a severe shock to global energy logistics.
The IRGC explicitly warned commercial shipping to avoid a southern corridor in Omani waters. Oman established this route for foreign vessels after Iran and the United States signed an interim peace memorandum last month. Iran now claims this passage is dangerous due to naval mines and insists ships must use a northern channel under Iranian military coordination.
Iran’s military stated the southern conduit will remain closed as long as US military actions continue. The IRGC warned that "not even a single drop of oil and gas or one package of chemical fertiliser will pass through it." The directive forces vessel operators to choose between a US-blockaded path and an Iranian-controlled one.
These maritime confrontations stem from a collapse of a brief diplomatic pause. Washington voided a June 17 temporary peace memorandum 10 days ago, reinstating a naval blockade of Iranian ports and resuming strikes on Iranian infrastructure. Iran has responded with missile and drone attacks on US bases in the region.
For energy markets, the physical bottlenecks are already translating into supply constraints. Damage to Qatar’s Ras Laffan Industrial Complex, combined with the blockage of the strait, has delayed an anticipated oversupply of LNG. This disruption removes a potential cushion for global gas prices.
Vessel operators and traders now face an unworkable insurance and routing environment. Navigating a contested waterway where both the US and Iran are actively targeting commercial shipping eliminates standard risk mitigation. The result is a forced de-risking of one of the world's most vital energy arteries.
