Amid rising tensions in West Asia after US-Israel strikes against Iran, Indian-American maritime executive Dr S.V. Anchan warned of the impact on the vital Strait of Hormuz and on global oil prices.
“Shipping is the hardest-hit industry in any such turbulence in the geopolitical situation,” the Safesea Group chairman told PTI. “The Strait of Hormuz must not be allowed to be shut down,” he added, urging swift action to guarantee safe vessel passage.
Anchan said oil prices were likely to climb with the recent developments, but warned that sustained high prices would harm the global economy. “It’s in no one’s interest globally, including the U.S.,” he said, likening a Hormuz closure to “choking the people at large of the region,” especially as some airspaces are already closed. He estimated about 150 tankers have anchored outside the strait and are not entering.
He said it is both an economic and regional priority for Arabian Gulf states to keep ports functioning and provide safe transit for ships, if necessary with naval escorts. The Strait of Hormuz, between Oman and Iran, links the Persian Gulf with the Gulf of Oman and the Arabian Sea and is one of the world’s key oil chokepoints. The US Energy Information Administration notes “very few alternative options” to move oil if the strait is closed; in 2024, about 20 million barrels per day—roughly 20% of global petroleum liquids consumption—transited the strait on average.
Anchan noted the maritime sector is typically the first to suffer during conflicts, particularly in confined waters like the Arabian Gulf. This situation is distinct, he said, because of direct US and Israeli action against Iran and Iran’s retaliatory strikes on neighboring countries, adding new uncertainties for maritime trade.
He pointed to insurance and operational challenges: US-owned ships already faced difficulties trading in the region because of uncertainties over Additional War Risk (AWR) insurance coverage. Many shipowners have opted to avoid Middle East waters, and charterers are hesitant until risks become clearer. He added that if Iranian oil exports were regularized in a manner similar to Venezuela, the tanker market would strengthen, benefiting bulk shipping as well.
Highlighting shipping’s central role—about 94% of world trade moves by sea—Anchan lamented the lack of recognition and support for the capital-intensive industry when it is distressed. He criticised the ease with which UN member states impose sanctions without accounting for the sector’s investments and noted that shipping is often directly targeted by maritime sanctions because of its ties to energy trade.
Anchan described the sector’s complexity: oil may be produced, refined, and operated from different countries, with owners, banks, insurers and ports spread across jurisdictions. Tankers traverse multiple routes and face overlapping checks and compliance demands. Breaching sanctions can lead to legal disputes, liabilities, reputational damage, delays, hefty fines and vessel detention. Many insurance policies now contain sanctions-related exclusions that protect insurers but burden shipowners.
He urged governments and the UN to consider the business communities likely to suffer as “collateral damage” from sanctions. Anchan proposed creating a recognised industry body—perhaps under the Global Compact or another framework—to provide input to the UN or sit on sanctions panels. If businesses were compensated for sanction-related losses, he argued, sanctions would be more effective and fairer. “Sanctions should be unbiased and not have differentiated and unjustified effects on third parties,” he said.
