The head of a major Japanese shipping firm now believes disruptions to transits through the Strait of Hormuz could stretch on longer than previously anticipated, with a string of attacks dramatically escalating the dangers faced by tankers hauling oil through the vital waterway. "Given the current state of affairs, it's difficult to see shipping recovering at all this year," President Toru Tamura said in an interview. "The risks right now have far surpassed what we can reasonably absorb."

After a period of relative calm, tensions between the US and Iran over control of the strait have reignited, heightening the threat to vessels carrying crude from the Middle East to global markets. Many risk-averse Japanese shipowners withdrew their vessels from the Gulf region after war broke out, but for safety reasons, they have largely stopped operating in those waters altogether.

Mitsui OSK Lines President and CEO Toru Tamura discussed with Bloomberg's Ann Shiely the latest impact of the Middle East conflict on his business and the outlook for the shipping industry. The shipping logjam has forced Japanese refiners to seek alternative crude supplies and transport routes, including purchasing oil from the US and tapping national petroleum reserves to stave off shortages and runaway prices. Before the war, Japanese refiners relied on the Middle East for more than 90% of their crude imports.

Tamura revealed that Mitsui OSK Lines had originally expected to start resuming Hormuz transits gradually from October, with operations returning to normal by January next year, but that timeline will likely slip. The restart of transit through the strait "may be delayed, though it's impossible to say at this point by how long," he said.

Although Japanese tankers have been avoiding the strait, other vessels have still passed through in recent months, with some ships turning off their transponders to evade tracking. Oil traders estimate that before the latest attacks, daily crude flows through the strait stood at roughly 6 to 8 million barrels. Tamura noted that for Mitsui OSK Lines to return to normal operations, it would need to ensure that multiple voyages could be completed safely, rather than assessing risk ship by ship or day by day. He added that sailing with transponders off should not become the norm, as such a practice is tantamount to accepting that vessels could be attacked at any moment.

There is a silver lining, though: as Japanese refiners diversify their crude supply sources, domestic shipping companies are carving out new transport routes. Tamura said demand for cargo from the US and West Africa has ticked up. His comments align with remarks from Soya Kawai, president of rival Nippon Yusen Kabushiki Kaisha, who said last month that the company was in talks with refiners to help import oil from Central America and Africa.