China-linked traffic through the Strait of Hormuz has sharply declined, with state-owned fleets avoiding the area due to safety and political concerns.
China-linked traffic through the Strait of Hormuz has slowed sharply after recent attacks, with transits largely confined to bulkers and one sanctioned VLCC, reports London's Lloyd's List.
Lloyd's List Intelligence data shows that only 11 China-linked vessels passed through Hormuz between March 1 and 15, with four transits occurring on March 10-11 and just one in the following four days. Mainstream state-owned tanker fleets have avoided the strait, citing safety, insurance, and political risks.
The few vessels that did transit highlighted opaque ownership structures. The Bailian Star, a bulker, broadcast 'Chinese crew n owner' via AIS despite unclear registry records. The sole tanker, Skywave, a US-sanctioned VLCC, also claimed Chinese ownership but lacked verifiable details.
An incident involving Source Blessing, a Chinese-owned vessel operated under Hapag-Lloyd and Maersk's Gemini Alliance, added to concerns after it was struck by debris en route to Jebel Ali. Though not transiting Hormuz and not directly attacked, the episode underscored the risks of collateral damage.
Insurance executives stated that coverage remains fluid, with brokers providing informal quotes that change daily. Political sensitivities during China's Two Sessions meetings also discouraged state-owned fleets from risking headline incidents.
Reports suggest that Iran may allow certain tankers through if oil trades are settled in yuan, though analysts doubt the feasibility. With Washington assembling a convoy coalition, Chinese shipowners are pivoting to the Red Sea. Seventeen Cosco and China Merchants VLCCs are now gathered there, helping sustain earnings.
