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As Hormuz Disruptions Persist, Shippers Log 10Yrs+ Highs
2026-09-03 12:22:47 The months-long crisis in the Strait of Hormuz has turned the long-overlooked shipping sector into one of the crowded trades of 2026, driving shippers to their peaks in more than a decade. The 35 US- and European-listed shippers tracked by Lloyd's List Intelligence have grossly spiked about 68% YTD, outperforming the S&P 500 by more than five times, while rallying 82% over the past 12 months. Data showed crude oil tanker stocks led the rally with gains of 120% YTD, followed by car carrier operators, gas shippers and dry bulk shippers. Andreas Povlsen, Managing Director at Hayfin Capital Management, said the shipping industry can serve as a hedge against geopolitical instability. He noted that freight markets have benefited from shaky conditions, including the COVID-19 pandemic, Red Sea Houthi attacks and Russia's invasion of Ukraine. Investors had already poured into the long-neglected shipping sector to position for downstream commodity supply chains and cash flow-generating hard assets. The subsequent outbreak of the Iran conflict severely disrupted the Hormuz, one of the world's busiest oil shipping routes, forcing tankers to take longer routes and driving up insurance costs, thereby tightening effective vessel supply amid ongoing global trade. Danaos Corporation (DAC.US) shares climbed to their highest level since 2008 and have risen 60% YTD, according to LSEG data. Shares of container operator Frontline Plc (FRO.US) and Teekay Tankers Ltd. (TNK.US) hiked to their highest levels since 2011. BW LPG Limited (BWLP.US) hit a record high, while Safe Bulkers, Inc (SB.US) and Navios Maritime Partners (NMM.US) reached multi-year highs. International Seaways, Inc. (INSW.US) hit a record high last week. The Breakwave Tanker Shipping ETF (BWET.US), which tracks forward freight agreements for crude oil tankers, has skyrocketed 650% since the Middle East conflict began in February and has surged more than 23-fold this year. Nicolas Tirogalas, CEO of London-based asset manager Tufton Investment Management, which focuses on the shipping industry, said longer shipping distances and rising ton-mile demand have boosted demand for oil and chemical tankers, dry bulk carriers and gas transport vessels. Tirogalas said that even if the Iran conflict ends, conditions are unlikely to return to pre-war norms. He noted that once economies find alternative suppliers, they usually do not revert, instead managing future disruption risks through supply diversification. ~ AASTOCKS Financial News Website: www.aastocks.com | |