Three weeks after the renewed blockade, the VLCC market has adapted to a different operating environment. Dark transits are the prevailing pattern through Hormuz, Arabian Gulf routes continue to command a sustained earnings premium over the Atlantic, and secondhand VLCC values are holding close to their first-quarter gains.

Iran–Oman Route Agreement NOT YET A PATHWAY

On 5 August, Iran announced an understanding with Oman on proposed corridor coordinates — inbound along the Iranian side, outbound along the Omani side. However, routing arrangements and any fee mechanism remain unconfirmed. The US has publicly opposed transit fees; the IMO maintains international law provides no basis for discriminatory transit charges. An Iranian parliamentary committee is also reviewing a draft bill that would prohibit US, Israeli and other "hostile" vessels and impose fines of up to 20% of cargo value. The draft has not been adopted. The regulatory and legal environment remains uncertain, limiting the prospects for a meaningful recovery in commercial transits.

Freight — East vs West of Suez EAST PREMIUM HOLDS

Arabian Gulf export routes continued to post the highest returns as of 6 August, with MEG–China (TD3C) and MEG–Singapore (TD2) both firming week-on-week. MEG–Med Suezmax (TD23) was near unchanged. Across the Atlantic basin, most benchmark routes eased, with Black Sea–Mediterranean Suezmax (TD6) the only major route to strengthen. US Gulf–China (TD22), West Africa–China (TD15), Caribbean and East Coast Mexico Aframaxes, and West Africa/Guyana Suezmaxes (TD20, TD27) all softened on the week.

VLCC Fleet Utilisation & Asset Values UTILISATION AT YEAR HIGH

VLCC fleet utilisation reached 48.4% by 21 July — the highest reading of the year and around nine percentage points above the three-year seasonal average and the equivalent 2025 level. Asset values followed a different trajectory: nearly 80% of this year's appreciation had already been recorded by March, well before utilisation reached its July high. Five-year-old VLCC values rose from $118M at end-2025 to around $143M, while ten-year-old values increased from $88M to approximately $113M. The stronger appreciation in older tonnage (+28% versus +21% for five-year-old vessels) narrowed the price gap between the two age brackets before it widened again, returning to around $30M by July.

Ballast vs Laden — East vs West of Suez EAST B/L RATIO RISING

The largest concentration of VLCC ballasters remains east of Suez, with 150 vessels in the Far East and 135 in the Arabian Gulf, compared with a combined 52 across the Americas, West Africa and Europe. Ballasters outnumber laden ships by 96% in the Far East and by 150% in the Arabian Gulf. The East of Suez ballast-to-laden ratio reversed sharply after 14 July, rising from around 1.0 to 1.5 by 6 August as laden VLCCs declined and ballasters increased. The move stands out for its speed, reversing the lower readings seen through late June and early July.

TAKEAWAY

Three weeks after the renewed blockade, the market continues to exhibit three distinct characteristics: reduced transparency in crude movements through Hormuz, a sustained earnings premium on Arabian Gulf export routes and secondhand VLCC values that continue to hold close to their first-quarter gains. At the same time, the increase in the East of Suez ballast-to-laden ratio from around 1.0 to 1.5 indicates that vessel availability has increased more quickly than laden employment in the region. Rather than pointing to a normalization in trading conditions, the combined evidence suggests that the VLCC market has adapted to a different operating environment, where fleet positioning, freight pricing and vessel deployment continue to reflect the disruption.