Shipping Through Strait of Hormuz Remains Volatile Despite U.S. Channel Efforts

U.S. military efforts to widen shipping channels in the Strait of Hormuz have allowed more commercial vessels to pass, though the waterway remains a high-risk zone, the chief executive of a major marine insurer said Sunday. Chubb Ltd. Chief Executive Evan Greenberg said conditions change quickly.

" Mines remain the chief uncertainty, he added.

Only a narrow channel is open for traffic, limiting the number of ships that can enter or exit at once, Greenberg said. The U.S. Navy is working to open additional lanes, which would allow more vessels to transit. Commercial traffic increased on Saturday, with 55 merchant ships carrying more than 17 million barrels of oil through the strait, according to the U.S. military's Central Command.

Lloyd's of London Ltd. announced a $400-million marine war-risk insurance consortium on Friday to cover vessels using the strait. The U.S. International Development Finance Corp. launched a $20-billion reinsurance program in March that Chubb and other insurers joined in April.

The U.S. military has been guiding ships through the strait with their signals turned off along a route near the coast of Oman, according to a document sent to the industry. Oil shipments have continued despite Iran's Saturday announcement that it had closed the strait again.

Greenberg described the environment as a war zone and said shipping volumes will increase only as the Navy clears more channels.