The Iran War and International Shipping: Navigating Disruption and Legal Risk in the International Shipping and Logistics Industries
KEITH B. LETOURNEAU Partner
NATALIE M. RADABAUGH Associate
G. EVAN SPENCER Associate
The escalation of armed conflict involving the United States, Israel, Iran, and certain Gulf states following coordinated U. S.-Israeli airstrikes in late February 2026 has significantly and immediately impacted international shipping and logistics. The Strait of Hormuz— a major maritime choke point for the global energy trade— has effectively been shut down, with daily vessel transits collapsing to a fraction of pre-war levels. The consequences for international shipping and logistics are substantial, and the potential legal implications for participants across the global maritime, energy, and supply chain industries are equally far-reaching.
Operational Disruption Not long after the initial airstrikes began, Iran effectively closed the Strait of Hormuz— through which roughly 20 million barrels of crude oil and more than 20 percent of global liquefied natural gas(“ LNG”) transit daily— and warned commercial vessels against transiting through the waterway. As a result, according to Windward and the BBC, transits through the Strait of Hormuz are down 94 percent( or roughly down to only five to six vessel transits per day in contrast to the pre-war average of 120 – 140 per day) since the start of hostilities, Arabian Gulf port calls dropped by 47 percent within just two weeks of the conflict’ s start, and crude exports from ports west of the Strait( e. g., ports in Iraq, Kuwait, Saudi Arabia, Qatar, and the United Arab Emirates) dropped by 87 percent. Iran has attacked and damaged multiple commercial vessels, resulting in the deaths of numerous seafarers. Many other vessels have been diverted or left awaiting clearance as nearby ports quickly fill up.
The disruption extends far beyond just the immediate areas near the Strait of Hormuz. Vessels of all types have been rerouted, including carriers opting to sail around the Cape of Good Hope similar to what was done in response to the Red Sea crisis. This voyage around Africa adds 10 to 14 days and sharply increases overall voyage transportation costs. Many ocean carriers have also pulled back from plans to resume Red Sea services in light of events.
Consequently, fuel costs, freight rates, and insurance premiums have surged. Brent crude surged to $ 119 per barrel at its peak, with diesel and gasoline prices following suit. According to the American Automobile Association, as of late March, the national average gas price in the United States had risen to nearly four dollars per gallon for regular gasoline.
At the same time, as a result of strikes on energy infrastructure in the Gulf region, parties have elected to halt oil and gas production or suspend or cancel contracts. On March 4, 2026, following attacks on its facilities, QatarEnergy, which is responsible for approximately 20 percent of the global LNG supply, declared force majeure on all of its LNG shipments. Following suit, on March 20, after drone strikes hit refineries in Kuwait, Iraq declared force majeure at all oil fields operated by foreign companies. On March 19, after a direct missile strike on the Ras Laffan complex, Qatar confirmed a halt to gas production at the facility.
The ramifications for downstream industries are still unfolding, and industry participants have started issuing warnings of potential global supply chain consequences,
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