Strait of Hormuz Disruption and its Impact on Dry Bulk Markets

If the Strait of Hormuz were closed, the impact on global shipping, energy, and agriculture would vary by duration but intensify over time. In a three-month closure, bunker prices—already near USD 1,005 per tonne—would remain elevated, supporting higher freight rates while constraining vessel supply, particularly in smaller dry bulk segments. Larger, more modern ships would benefit, while fertiliser markets would face significant disruption, tighter supply, and rising prices, especially for key products like urea and ammonia. In a six-month closure, the situation would worsen, with a deeper oil supply shock pushing bunker costs higher, reducing carrier profitability, and likely prompting partial mitigation through controlled vessel access and increased coal demand as an energy substitute. Fertiliser shortages would begin affecting crop yields and food prices. Over a 12-month closure, the consequences would be catastrophic, with extreme energy price spikes, severe global trade disruption, and major economic fallout, making diplomatic resolution highly likely.