China’s largest oil shippers abandon Hormuz, Bab al-Mandab as Middle East conflict deepens

Two of China’s largest state-owned oil shipping companies have halted all tanker traffic through the Strait of Hormuz and the Bab al-Mandab strait, according to a Reuters report on Tuesday, citing industry executives, vessel trackers and a ship broker.

The decision by COSCO Shipping Energy Transportation and China Merchants Energy Shipping (CMES) marks one of the clearest signals yet that the prolonged conflict surrounding Iran has rendered two of the world’s most vital energy corridors too dangerous for even Beijing’s biggest commercial fleets.

The two companies together control more than 100 very large crude carriers, each capable of hauling roughly two million barrels of oil.

Before the outbreak of hostilities between the United States, Israel and Iran in late February, they carried approximately half of China’s crude imports from the Middle East, excluding sanctioned Iranian volumes.

Instead of risking the chokepoints, the companies are now loading oil through ship-to-ship transfers at safer locations outside the Arabian Gulf, primarily off Fujairah in the United Arab Emirates and ports along the Omani coast.

The shift followed direct communications with Chinese central authorities, Reuters reported.

CMES had already informed investors in late July that its vessels would stay out of the Strait of Hormuz “for a long time.”

The Strait of Hormuz, a narrow waterway between Iran and Oman, normally handles nearly one-fifth of the world’s seaborne oil.

The Bab al-Mandab, at the southern entrance to the Red Sea, is the gateway for shipments heading toward the Suez Canal and Europe.

Both waterways have faced severe disruption since the start of the Iran conflict. Hormuz has remained heavily restricted for months.

In mid-July, Yemen’s Houthi movement, aligned with Iran, declared a maritime embargo targeting Saudi-linked shipping, further constricting traffic through Bab al-Mandab.

China, the world’s largest oil importer, has so far managed to maintain supplies by adapting logistics rather than confronting the risks directly.

The move by COSCO and CMES underscores a growing preference among major Asian operators for longer, more expensive but lower-risk alternatives.

The Energy Information Administration (EIA) map of the region highlights the two affected chokepoints: the Strait of Hormuz at the entrance to the Gulf and Bab el-Mandeb at the mouth of the Red Sea, with the Suez-Mediterranean (SUMED) pipeline shown as a partial land-based alternative for oil moving toward the Mediterranean.

The decision comes as other workarounds proliferate — including increased use of Saudi Arabia’s Red Sea export terminals, Oman’s Duqm as a transshipment hub, and even China’s newly launched seasonal “Ice Silk Road” container service through Russia’s Northern Sea Route.

Together, these developments point to a broader reconfiguration of global energy trade routes that once seemed fixed.

Analysts say the Chinese shippers’ withdrawal will not halt oil flows entirely but will raise costs, lengthen delivery times and add further pressure to already elevated energy markets.

For Beijing, the priority appears clear: protect its fleet and secure supplies while the conflict shows little sign of rapid resolution.

“Ice Silk Road” Through the Arctic — Skipping Suez, Hormuz & Red Sea Completely

Chinese shipping company Sea Legend has launched the first regular commercial container service along Russia’s Northern Sea Route (NSR), branding it the “Ice Silk Road.”

On August 15–16, 2026, the 1,740-TEU containership Dubai Tower departed Ningbo-Zhoushan Port in eastern China. It is sailing almost entirely along Russia’s Arctic coastline before reaching northern European ports (Felixstowe in the UK, Rotterdam, Hamburg, and Gdynia in Poland).

• Transit time: About 18–20 days

• Traditional Suez Canal route: Roughly 40 days (or longer with current Middle East disruptions)

• Cape of Good Hope alternative: Around 50 days

The service is seasonal (mainly July–October, while ice conditions allow) and currently uses small-to-medium ice-strengthened ships. At least eight voyages are planned this summer.

Cargo is mostly high-value, time-sensitive, and temperature-controlled goods: energy-storage systems, lithium batteries, solar modules, and new-energy vehicle components, as per SCMP.

Russia’s state nuclear company Rosatom controls Arctic navigation permits and provides nuclear-powered icebreakers when needed.

CAPTION

The map circulating with the announcement shows the dramatic shortcut:

• Red line: Northern Sea Route (Arctic) — ~18 days

• Blue line: Traditional Suez Canal route — 30–35+ days

It runs from Shanghai/Ningbo area, north through the Bering Strait, along Russia’s Arctic coast past the North Pole region, then south into the North Sea toward Hamburg and other European ports — completely avoiding the Indian Ocean, Red Sea, Suez Canal, and any Middle Eastern waters.Context: Why Now?This launch is not happening in isolation. It comes as the ongoing U.S.-Iran conflict has severely disrupted two of the world’s most critical shipping chokepoints:

• Strait of Hormuz (Persian Gulf oil and trade gateway)

• Bab el-Mandeb / Red Sea (route into the Suez Canal)

Major Chinese oil tanker operators (COSCO and CMES) have already halted transits through both waterways. Global shipping is scrambling for alternatives — Yanbu-Sidi Kerir pipeline workarounds, Oman’s Duqm as a bypass hub, Cape of Good Hope detours, and now a functioning Arctic corridor.

The “Ice Silk Road” gives China (and Russia) a Europe-Asia shipping lane that does not pass through waterways controlled or threatened by other powers.

It is small-scale for now — one 1,740-TEU ship is tiny compared with the 20,000+ TEU giants that normally run Asia-Europe — but it signals a strategic shift.

Why It Matters

One small ship does not rewrite global trade. But when paired with every other bypass effort happening right now, the pattern is clear: the classic chokepoints that once felt unavoidable are being actively worked around.

China is building redundancy.

Russia is monetising its Arctic coastline. And the rest of the world is watching a new polar trade lane move from experiment to scheduled service in real time.