Bangladesh, India, 4 others on Iran's 'friendly nation' list for safe passage thru Strait of Hormuz

Iran has agreed to ensure the safe passage of Bangladesh-bound energy vessels through the strategically vital Strait of Hormuz, offering a major relief from fuel supply anxieties triggered by the ongoing war in the Middle East.

Iranian Foreign Minister Abbas Araghchi confirmed on state television on Wednesday that Bangladesh is among the "friendly nations" permitted to navigate the waterway under coordinated arrangements, alongside China, Russia, Pakistan, Iraq, and India.

Officials in Dhaka say Iran's indication of allowing Bangladeshi vessels to pass could play a crucial role in easing the country's energy supply pressures. 

Bangladesh relies heavily on imports from the Middle East, with around 80% of its fuel requirements transported through the narrow waterway.

The development follows a formal request from Dhaka on 15 March, seeking Tehran's assistance to secure its energy imports. In response, the Iranian Embassy in Dhaka on Tuesday requested comprehensive details of the vessels carrying fuel and liquefied natural gas (LNG).

The Energy Division on Wednesday provided the Ministry of Foreign Affairs with a detailed list of six vessels scheduled for transit in April to facilitate diplomatic communication with Tehran. These vessels are carrying approximately 5 lakh tonnes of LNG and 79,000 tonnes of crude oil. 

The Strait of Hormuz, which typically carries around one-fifth of global oil shipments, has been under tight Iranian control since the United States and Israel launched attacks on Iran last month.

The channel, which usually handles around 120 vessels daily, has seen traffic plunge by about 95% in March, according to shipping data, with only a handful of crossings recorded in recent days.

Tehran's position

In his state television speech, the Iranian foreign minister said many countries requested them to ensure the safe passage of their ships through the strait, according to a report by Reuters.

"Many of the ship owners, or the countries that own these vessels, have contacted us and requested that we ensure their safe passage through the strait. For some of these countries that we consider friendly, or in cases where we have decided to do so for other reasons, our armed forces have provided safe passage," Araghchi said.

He added, "You have seen on the news: China, Russia, Pakistan, Iraq, and India. Two of its ships passed through a few nights ago, and some other countries, and even Bangladesh, I believe. 

"These are countries that spoke with us and coordinated with us, and this will continue in the future as well, even after the war."

The Iranian foreign minister rejected claims that the strait has been completely closed, saying controlled passage continues.

He also indicated that vessels linked to countries seen as adversaries or those involved in the ongoing conflict would not be allowed passage.

"We are in a state of war. The region is a war zone, and there is no reason to allow the ships of our enemies and their allies to pass through. But it remains open to others," Araghchi said.

Relief for energy security

The potential reopening of this maritime corridor is expected to play a pivotal role in mitigating Bangladesh's burgeoning energy crisis. 

Officials from the Energy Division, Bangladesh Petroleum Corporation, and Bangladesh Shipping Corporation noted that this development allows for the resumption of crude oil and LNG imports from Qatar, Oman, and Saudi Arabia at standard freight costs.

"The Iranian government's declaration will undoubtedly play a major role in ensuring our energy security," Munir Hossain Chowdhury, joint secretary (operations) of the Energy Division, told TBS. 

He noted that the move would diversify import sources and simplify the logistics of bringing refined fuel from the region.

Officials stated that Bangladesh has traditionally imported the majority of its refined fuel oil from China. Following Iran's announcement that it will not disrupt Chinese shipping, the Bangladeshi government will now have the opportunity to import refined oil from the Chinese firm, Unipec Singapore Pte Ltd. 

This comes after Unipec previously cancelled oil exports by invoking force majeure, citing disruptions to China's crude oil imports from Middle Eastern countries.

Furthermore, as Iran has announced that it will not intercept Indian oil tankers, the delivery of fuel from India – as per existing agreements – is now assured, said energy department officials. 

This has also created the potential for Bangladesh to import additional fuel from India should the need arise, they said.

The Bangladesh Petroleum Corporation typically imports between 1,00,000 and 2,00,000 tonnes of crude oil each month for processing at Eastern Refinery Limited in Chattogram, while LNG imports from countries such as Qatar and Oman also depend on the same route.

Due to the closure of the strait, Bangladesh is currently forced to import LNG from the spot market at prices two to two-and-a-half times higher than usual. Simultaneously, private companies are being compelled to import LPG from the United States at inflated costs. 

Officials believe that if the safe passage of Bangladeshi fuel tankers through the strait can be guaranteed, these gas shortages will be resolved.

Commodore Mahmudul Malek, managing director of the Bangladesh Shipping Corporation, said Bangladesh chartered a vessel named Nordic Pollux, owned by a US company, to transport 1,00,000 tonnes of crude oil from Saudi Arabia. The ship has been waiting at the Port of Ras Tanura in Saudi Arabia since 4 March, he said.

Commodore Malek said confusion remains whether the US vessel will enter the strait without written clearance from Iran.

"Through the Ministry of Foreign Affairs, we have requested written assurance from Iran regarding the passage of Bangladeshi oil tankers through the Strait of Hormuz. The vessel will only depart for Bangladesh once they have provided that guarantee," he said.

An official from the Energy Division, speaking on condition of anonymity, said since the safe passage of the Nordic Pollux through the strait could not previously be guaranteed, the government had initiated plans to charter a Turkish vessel. 

This plan involved transferring the oil from the Nordic Pollux to the Turkish ship for transport to Bangladesh. 

However, as Iran has now indicated that Bangladeshi oil tankers may safely traverse the strait, Bangladesh will no longer need to proceed with chartering the Turkish vessel.

Before the outbreak of the conflict, the Shipping Corporation had chartered another US-owned vessel, the Omera Galaxy, to import crude oil from the Middle East for the Bangladesh Petroleum Corporation. 

Iran won't block Bangladesh oil tankers

However, the ship's operators requested an additional fee to avoid the strait by taking an alternative route. Consequently, the Shipping Corporation cancelled the charter. 

Bangladesh will now be able to import oil through the strait at standard freight rates.

Commodore Malek said a decision has been reached to import a further 1,00,000 tonnes of crude oil from Saudi Arabia. To facilitate this, a Chinese vessel has been chartered; it is scheduled to arrive in Saudi Arabia on 20 April, load the cargo, and is expected to reach Bangladesh by 2 May.

Muhammad Fouzul Kabir Khan, former power secretary and energy adviser to the interim government, described the development as "comforting" given that 80% of Bangladesh's energy imports transit through the strait.

"Iran's announcement is undoubtedly a relief for the nation," he told TBS.