CITIC Securities: Hormuz Disruption Persists, Oil Transportation Uptrend Logic Still Advancing

Golden Ten Data reported on April 22 that a research note from CSC Financial indicated that the repeated tensions in the Strait of Hormuz demonstrate that the impact of this round of events on the oil shipping market is still unfolding according to a three-phase logic. After a brief reopening on April 17, Iran reimposed a blockade on April 18, indicating that the situation has not yet stabilized. Regardless of how the U.S.-Iran standoff develops, the market is currently in the process of the Hormuz disruption gradually transmitting to oil shipping fundamentals. The evolution of oil shipping rates occurs in three phases: freight rates rise during the conflict period; vessel rerouting extends voyage distances, pushing up freight rate benchmarks; and, after the blockade is lifted, a scramble for oil may drive rates higher for more than two months. At present, the third phase—following the unblocking of the Strait of Hormuz—will inevitably spark a global competition for crude oil, which in turn is expected to be transmitted to the oil tanker transport market.