Japan Trade Chief: Strait of Hormuz Shipping Remains Off-Limits

Japan's trade chief said commercial shipping through the Strait of Hormuz is off-limits in the near term after renewed hostilities and threats to vessels increased transit risks. Masahiro Okafuji, chair of the Japan Foreign Trade Council and chief executive of Itochu Corporation, told a media conference on Wednesday that no one would go there because it is dangerous, according to Bloomberg.

Okafuji stated that renewed re-routing around the Cape of Good Hope would raise transportation costs by over 30 percent. The Joint Maritime Information Center reaffirmed its regional threat level for the Strait of Hormuz at severe on Tuesday after raising it the prior week following the first signs of the collapse of the U.S.-Iran ceasefire.

The center said the regional maritime security threat level remains severe with further deliberate hostile activity likely under current conditions. Mariners should expect sustained naval presence, increased IRGC hailing and monitoring along transit routes, and possible diversion of AIS-equipped vessels to the northern Iranian-controlled route, the statement added.

Japan has been seeking alternative oil supplies in recent months after the Strait of Hormuz was blocked. Before the Iran war, Japan and its refiners relied on the Middle East for 95 percent of all crude imports. Japan imported the lowest volume of crude oil from the Middle East on record in April, dating back to 1979, as the Iran war and closure of the Strait of Hormuz choked supply.

The country's largest-ever release of oil stocks has helped refiners increase throughput, along with alternative supply from the United States and rare cargoes from Azerbaijan and Latin America.