The High Cost of Business as Usual in the Strait of Hormuz

The global energy apparatus possesses a remarkable capacity for compartmentalisation. Middle Eastern crude exports have somehow managed to return to pre-war levels, averaging 18.3 million barrels per day by late September—slightly above the baseline recorded in the twelve months before the US-Israel conflict with Iran began. Yet, on the water, the routine arithmetic of global trade collides violently with geopolitical reality. The latest disruption occurred nine nautical miles off the Omani port city of Limah, where a projectile struck the Panamanian-flagged oil tanker On Peace, igniting a fire in one of the world's most sensitive maritime bottlenecks.

Omani military forces swiftly deployed air assets to evacuate ten crew members from the damaged tanker, transporting them to Khasab hospital in the Musandam governorate for medical treatment. Of the nineteen seafarers on board, twelve sustained injuries in the strike. The human toll highlights a persistent vulnerability in international maritime supply chains: seventeen of the vessel's crew members, and eleven of those injured, are Indian nationals. New Delhi has noted that the continuing incidents of attacks on shipping in the region remain a cause of deep concern, reiterating its demand for an immediate cessation of strikes against commercial vessels.

For India, which ranks among the primary contributors of merchant marine labor globally, the conflict has exacted a steady price. At least ten Indian seafarers have lost their lives since hostilities erupted in late February, with additional fatalities recorded during cargo ship strikes in September. No group has formally claimed responsibility for the assault on the On Peace, but the operational context leaves little room for doubt. Ever since Iran effectively restricted access through the Strait of Hormuz at the start of the war, non-compliant merchant vessels attempting to bypass designated transit routes and fee demands have faced routine harassment and physical strikes.

The maritime intelligence firm Marisks recorded at least seven distinct incidents involving oil tankers over the course of a single week, indicating that the attack on the On Peace is part of an ongoing pattern rather than an isolated case. That oil continues to move in such volumes under these conditions speaks to the high risk tolerance of shipping operators and the relentless pull of global demand. However, markets reflect the underlying anxiety. Brent crude futures hovered around $101.51 per barrel following the incident, up sharply from $72.48 prior to the war. The physical pipeline remains functional for now, but its stability rests heavily on the shoulders of merchant crews.

Written by Thomas Nussbaumer thomas.nussbaumer@alpineweekly.com