Hormuz gas route keeps prices high

Ships are moving again through the Strait of Hormuz, the narrow Gulf passage carrying roughly a fifth of the world’s traded petroleum. Daily transits rose from fewer than 10 in early March to about 35 by June 22, according to S&P Global. More than 20 oil tankers carrying around 35 million barrels have crossed since the US-Iran agreement (CNBC).

Oil is moving again. LNG, liquefied natural gas cooled into liquid form so it can travel by specialised tanker, is still constrained. For Europe, and for a small island economy where energy costs quickly become household and business costs, that is the part of the story that matters.

Oil has detours. LNG does not.

The difference begins with geography. Some Gulf crude can avoid Hormuz completely. Saudi Arabia has a pipeline with about 5 million barrels per day of export capacity, while the UAE has a 1.8 million b/d route that bypasses the Strait (EIA). Oil is also easier to replace in the market. If one cargo is delayed, another from West Africa or the Americas can fill the gap.

Qatar’s LNG export terminals sit behind Hormuz, with no pipeline alternative. During the worst of the disruption, no laden LNG tankers crossed between March 1 and April 24. That removed more than 10 billion cubic feet per day of supply, enough to shift global LNG pricing (EIA).

The recovery has begun, but only partly. Qatar has started bringing empty ships back through the Strait. In the week to June 19, it loaded about a fifth of its pre-war pace (Energy Connects). Qatar says a damaged facility will remain offline while other production restarts (Infobae/EFE).

Gas prices have not followed oil down. Front-month TTF, the Dutch wholesale gas benchmark that sets the tone for prices across Europe, stood at €40.90/MWh on June 25. Brent crude fell to $72.75, giving up its war-related gains (Dawn/Reuters, CNBC). BNP Paribas described gas’s response as "more moderate" than oil’s, banker language for a market that remains expensive (BNP Paribas).

Why ships can pass but costs cannot fall

A vessel can now sail through Hormuz. That does not make the voyage commercially normal. War-risk premiums, the extra insurance charged for sailing through conflict zones, remain at roughly 3–4% of a vessel’s value, compared with about 0.25% before the war (S&P Global, Allianz Commercial).

Around 1,150 loaded vessels, carrying cargo worth about $125 billion, were still waiting for Gulf passage in late June (Allianz Commercial). Maersk sent two ships out of the Strait but kept three inside the Gulf. Companies are judging sailings one by one instead of returning to normal schedules (The Copenhagen Post).

This is the mechanism that turns a security risk at sea into a cost across Europe. The insurer charges the shipowner more. The shipowner raises freight costs. The buyer pays more for delivered LNG, petrochemical feedstocks and factory inputs. European gas users and industrial buyers sit at the end of that chain.

Cushioned, exposed, or building

The burden is uneven. Germany imports only 6.1% of its crude from the Middle East, but depends on imports for 67% of its energy (Destatis). Its exposure is less about an immediate shortage than about global prices: buyers cannot be sure when cargoes will arrive or what they will cost. Chemical-industry analysts expect petrochemical feedstocks to normalise only slowly, in some cases not before 2027 (Chemie Technik).

Spain is better cushioned. Its gas storage is above 70%, against an EU average of around 46%, and only 1.7% of its supply is directly linked to Hormuz (Europa Press, Energy Aspects). Full storage tanks protect against a volume shock. They do not protect against market-price risk, because Spain buys gas in the same European market where the marginal cargo shapes expectations for everyone.

Poland is building more options, with 8.3 bcm/year of LNG capacity at Świnoujście and two floating terminals planned by 2030 (GAZ-SYSTEM, gov.pl). Terminal capacity helps resilience. It cannot create LNG if ships are delayed or too expensive to send.

The Enagas chairman told Ara that gas-price futures do not point to full normalisation until late 2027 or early 2028. That is a market forecast, not a certainty. But it is the clearest measure of what reopening Hormuz means in practice. Oil has routes around the problem. Gas still has to pass through it.