Policies covering ships moving through the Strait of Hormuz are cancelled

[SamuelTheThird]

Contra people here saying the strait wouldn't be affected...

Link to tweet

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[CanonRay]

1. This shows who really rules the world

Lawyers and insurance companies. The Strait of Hormuz will close now.

[JustAnotherGen]

2. N/S

[FBaggins]

3. That's nothing new and doesn't close the straight

It increases the cost of transporting oil far less than the increase in the value of the oil the tanker is carrying.

In the 1980 “tanker war” premiums quadrupled (far more than speculated here)… yet traffic continued to flow with little interruption

[SamuelTheThird]

4. No policy equals no ship transporting oil

[FBaggins]

5. Untrue... but also irrelevant

Because you’ve misread the news if you’re taking it to mean that insurance isn’t available.

The first step to increasing the rate on a voyage when markets are closed as they are now - is to cancel the initial policy.

Here’s a better source -

Cargo war risk insurers, which cover goods transported on tankers such as oil and grain, are also preparing to cancel policies and renegotiate coverage at higher rates, brokers said as per the news outlet.

https://www.livemint.com/news/world/strait-of-hormuz-crisis-insurers-cancel-policies-raise-war-risk-premiums-on-ships-after-israel-strikes-on-iranreport/amp-11772309959461.html