Hormuz and the Red Sea: what the crisis changes for your exports to the Gulf

As of 13 October 2026, the Strait of Hormuz remains closed to normal traffic, the Red Sea has been weakened by the Houthi blockade targeting Saudi-linked vessels, and exports to the Gulf have to go through other ports, more slowly and at higher cost. Demand has not disappeared: repairs to energy facilities, bypass infrastructure and food security continue to generate purchases, while construction is slowing. Sanctions risk now extends to the carrier, the vessel and the insurer. The situation is changing fast: the facts below are as of 12 October 2026 and must be checked again before each shipment.

What is the situation as of 13 October 2026?

The war began on 28 February 2026 and the Strait of Hormuz has been effectively closed since 1 March (Agroberichten Buitenland, 31 March 2026). On 4 October, the IMF's PortWatch tool counted 4 transits, compared with 85 a day before the crisis; 172 vessels were waiting in the area (straits.live, 12 October 2026). September was nonetheless the busiest month since the start of the conflict, outside the period of the agreement, with at least 379 transits, of which only 15 were container ships, mostly state-backed feeders; more than 90 attacks on merchant vessels have been recorded since the conflict began (Lloyd's List Intelligence, 30 September 2026).

Oil is faring better than containers: counting diversions to the Saudi west coast and the east coast of the UAE, Middle Eastern crude exports excluding Iran have returned to around 18.5 million barrels a day, close to the pre-war level (Kpler via Cyprus Shipping News, 12 October 2026).

Negotiations are deadlocked. On 4 October, Iran made reopening conditional on seven demands, including the lifting of the US naval blockade (The National, 4 October 2026); on 12 October, Tehran deemed the US response insufficient (straits.live).

In the Red Sea, the picture is mixed. On 20 July the Houthis declared a blockade targeting Saudi Arabia (Foreign Policy, 20 July 2026) and since mid-September they have controlled the Yemeni shore of the Bab el-Mandeb Strait (Al Jazeera, 13 September 2026). At the same time, the Suez Canal recorded 1,232 transits in August, its best month since December 2023 (Lloyd's List Intelligence, 18 September 2026).

How much do freight and insurance cost?

The bottleneck is often on land: trucks, customs and feeders between the bypass ports and final destinations (Bertling). In mid-July, the Jeddah container yard was 90% full (Spoterix).

Is Gulf demand holding up?

It is falling in 2026, with sharp differences. In its October 2026 outlook, the IMF forecasts for 2026 a contraction of 2% for the Middle East and North Africa region, 3.3% in Saudi Arabia, 3.9% in the UAE, 11.3% in Bahrain, 15.6% in Qatar and 16.7% in Kuwait, but growth of 4.1% in Oman. It expects a strong rebound in 2027 (+7.9% in Saudi Arabia, +7.7% in the UAE), assuming a gradual reopening of the strait from March 2027 (The National, 13 October 2026). The World Bank forecasts a contraction of 4.3% for the Gulf Cooperation Council (GCC) countries (World Bank, October 2026), and the WTO a 15.4% fall in Middle Eastern imports in 2026 (BNN Bloomberg, 8 October 2026).

Contract awards show two-speed demand. In the third quarter of 2026, contracts awarded in the GCC fell by 37.2% year on year, to $47.4 billion: construction dropped by 44.7%, while gas rose by 59.9% and chemicals almost quintupled (GDN Online / Kamco, 7 October 2026).

What is still being bought despite the crisis?

Repairs. In April 2026, Rystad Energy estimated the cost of repairing energy facilities at between $34 billion and $58 billion, and highlighted the shortage of available equipment and deployable specialists (OilPrice, 16 April 2026). These purchases go through the EPC contractors and equipment suppliers already in place: access comes from getting listed as an approved supplier, subject to local content rules.

Bypass infrastructure. The Gulf states are treating it as permanent:

• a new DP World port at Fujairah, deliverable in 18 months (Enterprise AM, 14 July 2026) and a second oil pipeline to Fujairah planned for 2027 (CNBC, 15 May 2026);
• at Khor Fakkan, weekly throughput up from 8,000 to 65,000 TEU and a $2 billion expansion from 3.5 to 10 million TEU in 36 months (Nautica Shipping, 14 August 2026);
• at Sohar, in Oman, traffic up 52% in the first half and OMR 2.62 billion of projects under way (Muscat Daily, 19 August 2026);
• at Jeddah, SAR 641 million of cranes and handling equipment, and cold stores increased from 8 to 75 (Arab News, 13 July 2026);
• the Saudi Landbridge railway, around $26.6 billion and more than 1,500 km, whose Riyadh section (around $7 billion) was under commercial evaluation at the end of August (Construction Review Online, 31 August 2026).

Food security. Saudi Arabia imports 80 to 85% of its food and the UAE around 85%. Since 3 March 2026, Iran has banned exports of its fruit and vegetables, which accounted for more than €2.6 billion of fruit and €1.3 billion of vegetables a year for the Gulf (Agroberichten Buitenland, 31 March 2026). Fresh produce, the cold chain and greenhouse agriculture are benefiting.

What is the sanctions trap?

EU sanctions against Iran were reinstated at the end of September 2025: asset freezes from 29 September and sectoral measures from 30 September, including a ban on exporting oil, gas and refining equipment, naval equipment, certain management software, steel and aluminium (Mayer Brown, 3 October 2025).

The new trap comes from the strait. OFAC, the US sanctions authority, designated the "Persian Gulf Strait Authority" (PGSA) on 27 May 2026, followed on 29 July 2026 by the insurer PGMIC and HormuzSafe. Its alert of 24 August 2026 states that US and non-US persons expose themselves to sanctions by dealing with these entities, including by accepting their insurance or responding to their requests for information in order to obtain safe passage, even without payment. It calls on maritime service providers to apply enhanced due diligence to any vessel transiting Hormuz (OFAC, 24 August 2026).

For an exporter, screening therefore no longer stops at the customer. It also covers the bank, the consignee, the carrier, the vessel and the insurer, as well as the risk of re-export to Iran. Only civilian goods, for identified civilian end users, fall within the scope of this article; a dual-use item requires an analysis and, where applicable, a licence.

What checklist should be followed before shipping to the Gulf?

1. Route. Choose a port that avoids Hormuz: Jeddah for Saudi Arabia, Fujairah or Khor Fakkan for the UAE, Sohar for Oman. Allow an extra 2 to 6 weeks.
2. Port of entry and final leg. Agree with the buyer on the port of entry, customs clearance and who arranges the truck or feeder.
3. Incoterms. Specify who insures the war risk. Under Incoterms 2020, CIP requires all-risks cover (Institute Cargo Clauses A) and CIF minimum cover (Clauses C) (ICC); war risk must be added expressly.
4. Price. Limit the validity of quotations and provide for revision of freight and insurance surcharges.
5. Payment. As of 26 June 2026, the OECD classified Saudi Arabia, the UAE, Qatar and Kuwait in category 2, Oman in 3 and Bahrain in 6 (OECD). Favour a confirmed documentary credit or credit insurance.
6. Sanctions. Screen the customer, beneficial owners, bank, carrier, vessel and insurer; require a sanctions clause in transport and insurance contracts.
7. Contract. Provide for force majeure, rerouting and suspension in the event of sanctions.
8. Timing. Check the status of the strait and the Red Sea again before each departure.