Iran seizes second oil tanker in a week amid escalating shipping spat

Iran has seized another oil tanker, the US Navy said May 3, its second interception in a week, escalating a diplomatic row that could heighten risks of transit through the critical Strait of Hormuz chokepoint.

The Panama-flagged Niovi was seized at approximately 6:20 am local time (0250 GMT) after departing Dubai for the port of Fujairah via the Strait of Hormuz, the Navy said in a statement.

A dozen "fast-attack craft" controlled by the Islamic Revolutionary Guard Corps "swarmed" the Niovi in the middle of the strait, forcing the tanker to sail towards Iranian territorial waters off the cost of Bandar Abbas, according to the statement.

The Niovi is a VLCC tanker that was part-loaded on route to Fujairah and was last seen early May 3 transiting the Strait of Hormuz, according to S&P Global Commodities at Sea vessel tracker. The tanker was last seen loading a 2 million barrel cargo of Saudi crude at Ras Tanura in mid-April.

Iranian state media said a foreign, Panama-flagged oil tanker, which it did not name, had been seized for violating regulations, without providing any further details.

It comes six days after Iran seized the Marshall Islands-flagged oil tanker Advantage Sweet while it sailed in international waters in the Gulf of Oman.

According to S&P Global Commodities at Sea, the Advantage Sweet was transiting the Gulf of Oman on April 27 carrying an 800,000-barrel cargo of Ratawi crude for Chevron loaded at Kuwait's Mina Saud terminal on April 25. The tanker was en route to the US at the time, according to CAS.

Chevron has declined to comment on the incident.

"Iran's actions are contrary to international law and disruptive to regional security and stability," the US Navy said, adding that Iran has "harassed, attacked or interfered with the navigational rights of 15 internationally flagged merchant vessels" over the past two years.

The Financial Times has reported that the seizure may have been in response to the US' redirection of the tanker Suez Rajan – loaded with Iranian crude and destined for China – to the US, which has imposed heavy sanctions targeting Iran's oil trade.

US officials have not commented on the report.

The Strait of Hormuz is a critical chokepoint through where 30% of the world's seaborne oil transits, and previous tanker incidents in and around the Gulf have spooked oil and shipping markets, though crude prices have fallen in recent weeks over wider global economic concerns. Front-month ICE Brent futures were trading at $73.77/b as of 0936 GMT, down 2.06% on the day.

Platts, part of S&P Global Commodity Insights, assessed the VLCC rate for shipping 270,000 mt from the Arab Gulf to China at $13.69/mt May 2, unchanged from April 27.