Iran’s Revolutionary Guard Navy turned back three ships near Larak Island on Friday afternoon, including two Chinese state-linked COSCO vessels (CSCL Indian Ocean and CSCL Arctic Ocean) and the Marshall Islands-flagged, Hong Kong-owned bulk carrier Lotus Rising.
The IRGC issued a blunt statement: the Strait of Hormuz is “closed,” and shipping to or from “ports of allies and supporters of the Israeli-American enemies” is prohibited. Any transit will face “harsh measures.”
Why This Matters
China had a working corridor. Beijing-flagged tankers were paying $2M tolls in yuan under the IRGC’s ad hoc regime. That arrangement is now void. The move came hours after Trump claimed Iran let 10 Pakistan-flagged tankers through as a “present,” forcing Tehran to prove it plays favorites for no one.
Market Impact
- War-risk premiums likely jump above 3% of hull value by Monday
- VLCCs loading Arabian Gulf crude for East Asia face Cape rerouting: +10-14 days, +$800K in bunker costs per voyage
- Spot tanker rates will spike on dirty routes
- Brent (~$108) faces upward pressure toward $115 if China cannot negotiate a restoration
What to Watch
Whether Beijing sends naval escort or quietly reroutes. If COSCO diverts, Iran has effectively shrunk the global tanker fleet by tying up vessel-days on longer voyages. Fujairah anchorage counts and AIS gaps near Larak will signal whether this blockade holds or softens.