Oil buyers shun 45 blacklisted tankers as Iran tightens Hormuz grip

At least three Indian refiners and a global energy major will stop chartering vessels on Iran's 45-ship blacklist over security concerns.

At least three Indian oil refiners and a global energy major plan to stop using vessels on Iran's 45-ship blacklist, including for ship-to-ship transfers, four people with direct knowledge said.

"We will avoid our chartered vessels dealing or STS or anything to do with non-compliant ships for Middle Eastern cargoes," said a source at an Indian refinery, who declined to be identified because of the sensitivity of the issue.

Tehran announced the blacklist Sunday, saying the named vessels broke its rules for crossing the Strait of Hormuz and could be fined, detained and have cargoes confiscated, according to a post on X from the Persian Gulf Strait Authority, a new body Iran set up to manage the waterway. Some of the tankers are owned or chartered by Saudi Aramco and Abu Dhabi National Oil Co., used to shuttle crude, refined products and liquefied natural gas out of the Gulf for transfer off Fujairah in the UAE or Sohar, Oman.

The move threatens to further choke oil flows through a waterway that carried roughly 20 percent of global oil and LNG supply before the war, with UK Maritime Trade Operations estimating AIS-detected traffic remains about 90 percent below pre-war levels. Only five ships transited Hormuz on Monday, well below the 10-day average of 15, data show.

Shuttle Runs Under Pressure

Iran's announcement appears designed to impede the shuttle runs Gulf producers such as the UAE and Saudi Arabia have undertaken with dedicated tankers to move oil through Hormuz for unloading via STS transfers in the Gulf of Oman onto ships bound for end-users. Those runs have kept Middle East oil flowing after Iran's clampdown on shipping through the strait during the war. Several charterers and shipping firms are discussing internally whether to continue STS operations, with one Gulf crude buyer saying it would be safer to buy oil on a delivered basis shipped to a final destination instead of free-on-board at STS locations in the Gulf of Oman.

Ana Subasic, a trade risk analyst at shipping tracking firm Kpler, said the most compliance-sensitive buyers are expected to avoid these vessels moving forward, but the trade is more likely to reroute through alternative tonnage, counterparties or transfer locations than disappear altogether. "The key issue is contagion," Subasic said. "If Iran follows through on threats to penalize vessels that conduct STS transfers with blacklisted tankers, that should narrow the pool of willing shipowners, charterers and buyers, particularly among firms with material Gulf exposure, while increasing due-diligence requirements and potentially freight, insurance and risk premia."

Contagion Risk Spreads

Two of the 12 very large crude carriers on Iran's blacklist were no longer broadcasting their location through automatic identification systems by Tuesday after the list was released, while the rest had their AIS transponders switched off for weeks. Iran has previously attacked several of the tankers, including the Wedyan, Mombasa B and Al Bahyah. "Our internal departments are still in discussion on how to proceed with crude deliveries from the Strait of Hormuz via ship-to-ship transfers in the long term," said KY Lin, president of Formosa Petrochemical Corp.

The escalation comes as Washington prepares new economic measures against Tehran, with Treasury Secretary Scott Bessent set to unveil the package. Iran has threatened to prevent any oil from leaving the Persian Gulf if the US proceeds, while Iranian crude shipments to Asia have already all but dried up, according to Bloomberg. With the seven-day average of oil leaving Hormuz having climbed above 8 million barrels a day, according to Energy Secretary Chris Wright, any further disruption to the shuttle system would tighten global supply and push freight and insurance costs higher.

This article is for informational purposes only and does not constitute investment advice.