US Naval Blockade Halts Iran’s Main Oil Export Terminal at Kharg Island

Since July 31, 2026, Iran’s primary oil export terminal on Kharg Island has been effectively shut down, with no oil tankers loading there for at least a week. This follows the United States’ reimposition of a naval blockade on Iranian ports in mid-July after the collapse of a temporary agreement to keep the Strait of Hormuz open. Satellite images analyzed by maritime intelligence firm Windward show all three loading docks at Kharg Island have remained empty for an extended period. On July 28, only 16 vessels were anchored in the waiting area around the island, the lowest number since early June.

Kharg Island is critical to Iran’s oil exports, handling about 90% of its crude shipments due to the shallow coastal waters elsewhere in the country that cannot accommodate large tankers. Richard Bronson, head of geopolitics at Energy Aspects, confirmed the blockade’s effectiveness, noting minimal tanker movement in or out of the terminal. However, he cautioned that the loss of oil revenue is unlikely to force Tehran into concessions in negotiations with Washington, as Iran believes it holds the strategic upper hand in the Strait of Hormuz conflict and is willing to endure significant economic damage to maintain this advantage.

Iran had continued loading tankers at Kharg throughout the six-month conflict with the US and Israel, making the current disruption the longest since the war began. The group United Against Nuclear Iran reported that since July 12, no fully loaded Iranian oil tanker has successfully exited the Persian Gulf. Iran is still receiving income from shipments that left during the ceasefire period and are now reaching Asian customers, particularly through transfers near Malaysia to refineries in China. However, these revenues are expected to cease in the coming weeks.

The blockade also prevents empty tankers from returning to Iran after offloading cargo in Asia, with some waiting near Sri Lanka and others spotted off Oman and Pakistan. Despite the terminal shutdown, storage tanks on Kharg have not filled significantly, suggesting Iran may have reduced oil production to avoid storage capacity issues, according to Energy Aspects.