The International Union of Marine Insurance estimated on September 23, 2026, that insurers’ losses linked to the Strait of Hormuz crisis had reached about $2 billion, as cargo and hull insurance premiums rose dozens of times over since the escalation began in late February. Daily transits fell to about 20 vessels in September, from more than 130 before the crisis.
The fallout extends beyond the direct increase in fuel and shipping costs. The Shipping Advisory Group, which includes maritime authorities from 18 countries in Europe, Asia and North America, warned in a statement issued on September 8, 2026, that uncertainty over future access to ports and sea routes was undermining long-term commercial planning and raising costs for companies and consumers.
Insurance becomes a commercial constraint
The decline in vessel traffic has reduced insurers’ revenues despite the sharp increase in premiums per voyage, while companies have paid compensation for damage and vessel downtime. Industry data showed that transits had fallen by about 85% from pre-escalation levels, making the availability and cost of insurance coverage a decisive factor in the decisions of shipowners and operators.
The United States launched a $40 billion reinsurance facility to cover transits, while Saudi Arabia is working to establish a marine insurance pool combining government financing with private insurers. DP World provided cargo coverage against physical losses related to the war.
The number of confirmed maritime incidents in the Strait of Hormuz and the surrounding area reached 85 as of September 24, 2026, according to the International Maritime Organization. Continued attacks on vessels add to insurance burdens and crew risks, limiting companies’ ability to restore regular voyages even when transit routes are operationally available.
One-fifth of energy trade under pressure
Average oil flows through the Strait of Hormuz stood at 20.9 million barrels per day during the first half of 2025, equivalent to about 20% of global liquids consumption and one-quarter of seaborne oil trade, according to the U.S. Energy Information Administration. The strait also carried 11.4 billion cubic feet per day of liquefied natural gas, more than 20% of global LNG trade.
LNG options appear more constrained than those for oil, as Qatar and the UAE rely on specialized liquefaction facilities, carriers and receiving terminals to export to global markets. The International Energy Agency estimated that about 20% of global LNG trade passed through the strait in 2025, pointing to limited spare capacity on the Dolphin pipeline and Oman’s export terminals nearing full-capacity operations.
Gulf states accelerate bypass routes
Existing pipelines in Saudi Arabia and the UAE can transport about 4.7 million barrels per day away from the Strait of Hormuz, a capacity that covers only part of normal flows. Saudi Arabia’s East-West pipeline carries crude to Red Sea ports, while Abu Dhabi’s oil pipeline reaches the port of Fujairah on the Gulf of Oman.
Abu Dhabi National Oil Company is accelerating construction of a second pipeline to Fujairah. It said in May 2026 that the project was 50% complete and that it aimed to expedite implementation toward 2027. The U.S. Energy Information Administration estimates that the new pipeline will add capacity of 1.5 million barrels per day to bypass the strait.
The crisis is prompting Gulf producers to reassess their long-term reliance on a single maritime corridor. But alternative pipelines and ports require major investment and extended construction periods, and could shift some risks to other routes, including the Red Sea and Bab el-Mandeb. Stability in navigation and insurance in Hormuz will therefore remain a key factor in global energy trade and shipping plans.
