The Strait of Hormuz is open, what risks remain?

The Strait of Hormuz, a critical global trade artery, has reopened after being closed for six weeks due to conflict between the U.S., Israel, and Iran. While Iran's foreign minister declared the strait fully open, the reality is more complex: only a narrow, coordinated route—about one-third of the strait—is currently accessible, due to lingering mines and military blockades. Despite the reopening, major risks remain, particularly around safety, insurance, and geopolitical tensions. Insurers are cautious, waiting for clarity on the exact route, mine locations, and how the U.S. and Iran have resolved issues like tolls and the role of Iran’s Revolutionary Guard Corps (IRGC), which is designated a state sponsor of terrorism. Western vessels face significant hurdles, including sanctions and banking restrictions, while Chinese and Southeast Asian ships have been able to navigate the strait by paying tolls in cryptocurrency or yuan. The episode highlights how a relatively low-cost strategy—closing a vital waterway—forced a major military power to de-escalate, setting a potentially dangerous precedent for asymmetric warfare in other global chokepoints like the Bab al-Mandab Strait and the South China Sea.