PETALING JAYA: Shipping markets remain on edge, with industry players warning it could take more than a year for global supply chains and freight routes to stabilise after turmoil in the Strait of Hormuz disrupted trade flows, even if a peace deal between the United States and Iran materialises.
Malaysia Shipowners’ Association chairman Mohamed Safwan Othman said this is due to safety and security concerns, as well as charterers’ appetite to resume operations amid possible “flip-flops” by all parties involved.
“It will take one year, if not more, to return to the pre-crisis state,” he said when contacted yesterday.
The US-Iran conflict that began on Feb 28 stopped shipping through the transit route for around a fifth of the world’s oil and liquefied natural gas supply, along with key products such as aluminium and urea.
Asked how severely the shipping routes are affected by the situation near the strait, Mohamed Safwan said that there are still other shipping routes outside the Middle East that are not heavily disrupted, as East-West trade does not necessarily pass through the Strait of Hormuz.
“We have to wait for the manufacturers and many other industries that require the movement of cargo and goods.
“That being said, it really depends on how fast these industries can pick up after the crisis.”
“Shipping remains the most efficient, cost-effective method for moving goods, and overreliance on foreign-flagged vessels can reduce the degree of control any country has over the flow of goods into its territory,” he said in highlighting the need for more Malaysian-flagged vessels to serve the country.
The Federation of Malaysia Freight Forwarders president Datuk Dr Tony Chia said the situation appears to be moving towards a formal US-Iran peace deal, with the reopening of the strait being one of its provisions.
“However some controlled movements were reportedly occurring through designated safe corridors, though many major operators remain cautious.”
Chia stressed that if the agreement holds and there are no renewed military incidents, limited commercial transit may begin within days.
“But, returning back to full pre-war normality will likely take between three to six months. The biggest variable is not the signing ceremony itself, but whether shipowners, insurers and others believe the ceasefire will remain durable,” he explained.
“For freight forwarders and logistics operators in Malaysia, Gulf-bound cargo may start moving immediately after the signing, but vessel schedules, freight rates and transit reliability are likely to remain volatile through July and possibly August 2026,” he said.
US president Donald Trump insisted that the strait would be clear by Friday (June 19).
“We have a lot of lanes right now already,” Trump told reporters at the Group of Seven summit in France early this week, where he maintained that the channel “is going to open and be toll-free”.
