Strait of Hormuz traffic returns to normal by December 31?

The key issue is not whether traffic is improving at the margins, but whether it can jump from depressed levels into a range that qualifies as normal under this market’s definition. Recent reporting suggests the Strait of Hormuz is still seeing only single-digit to low-teens daily commercial transits, with a 10-day average around 10 to 15 vessels, which is far below the threshold of a 7-day moving average of 60. That means the market is asking for a very substantial normalization, not just a modest rebound. From the current operating level, the required increase is large enough that it would likely need a clear and durable reduction in regional security risk, not merely a few better shipping days.

Arguments for Yes center on the fact that the strait is not fully shut, and shipping activity has shown signs of partial recovery. Some reports indicate vessel movements have improved in bursts, and there are examples of heavily escorted or managed traffic that look closer to ordinary throughput than the worst recent periods. If there is a credible de-escalation in military tension, a stabilization of insurance conditions, and a willingness by shipowners to resume regular routing, traffic could rise quickly because the Strait of Hormuz remains an economically essential corridor. In other words, the infrastructure and strategic need are still there, so a return toward normal is physically possible if the political and security environment improves fast enough.

Arguments against Yes are stronger at this point because the market requires a specific, high bar by year-end and the latest data remain far below it. The combination of strike risk, insurer caution, routing changes, and transponder or AIS irregularities suggests that the shipping market is still behaving defensively rather than normally. Even if traffic improves gradually, moving from roughly 10 to 15 vessels per day to a sustained 60-plus 7-day average would require a dramatic acceleration, and there is limited evidence that such a rebound is underway. The most plausible path to Yes is a sharp geopolitical thaw, but absent that, the data trajectory looks more like slow normalization or continued suppression than a full return to pre-crisis conditions.