Discussion centred first around the impact of the Venezuela crisis on charterparty negotiations. The Panel opened by drawing a useful distinction between the immediate impacts and those that emerged in the months that followed. In the immediate aftermath of the US military operation in Venezuela, war risk clauses became a central topic of discussion, particularly in the context of time charter negotiations. While some standard forms (such as the SHELLTIME 4) already make provision for war risks, others commonly used in the market, such as the NYPE form, do not.

As a minimum, owners would therefore be seeking to incorporate a war risks clause in their charter (typically in the form of the BIMCO CONWARTIME clause). This clause allows an owner, in the exercise of reasonable judgement, to refuse or deviate from a charterer's orders where the vessel would be exposed to war risks. The key amendment owners sought was straightforward: the express exclusion of delivery to certain countries, including Venezuela, on account of their risk profile. Beyond this, the Panel highlighted several related negotiation points, including the allocation of war risk insurance premiums, provisions for alternative discharge ports, and the scope of the definition of "war risks". The interaction between war risk provisions in the charterparty and those in the bill of lading was also flagged as an important area of risk that owners needed to manage carefully.

As the immediate crisis subsided, the focus of charterparty negotiations shifted to sanctions compliance, particularly in the context of US sanctions applicable to the lifting of Venezuelan-origin oil. The Panel explained that even where a charter is governed by English law, the relevance of US sanctions cannot be ignored—charter hire is predominantly denominated in US dollars, which is typically a sufficient nexus to attract US sanctions jurisdiction, and, even absent such nexus, entities could be exposed to secondary sanctions for materially assisting or providing goods or services to designated entities. 

The discussion then turned to OFAC's General License 46A, issued in February 2026, which now serves as the primary authorisation enabling the lifting and trading of Venezuelan-origin oil under US sanctions. Under this licence, US entities may engage in conduct otherwise prohibited by sanctions regulations, provided certain conditions are met. Critically, for English charterparties, OFAC FAQ 1230 notes that the protections of the General License extend to services that are ordinary, incidental and necessary to the performance of such transactions (including transportation and logistics services). 

In light of these developments, the Panel recommended that owners include, at a minimum, audit rights in their charters to ensure charterers' compliance with the conditions of the licence. The Panel also cautioned that foreign policy decisions can change with little/no notice, so charter arrangements should address the risk of the licence being amended or revoked.

The discussion then turned to the current situation in the Middle East, which presents a distinct set of legal and commercial challenges for shipowners. Heightened security risks in the Strait of Hormuz have raised significant concerns about the safe transit of vessels through the region. In these circumstances, war risk clauses are again being closely scrutinised, with the potential for impasses between owners and charterers to escalate into wrongful repudiation territory.

Beyond this, the Panel identified a range of further issues likely to arise, including additional war expenses such as insurance premiums and increased crew wages; the engagement of trading limits clauses; potential disputes over off-hire and laytime / demurrage provisions; as well as the possible engagement of force majeure clauses. For more information on these considerations, please refer to our latest briefing on the The legal impact of the conflict in the Middle East.

With the legal landscape mapped out, the Panel brought a welcome market perspective to the discussion. The central question examined was whether recent disruptions have permanently increased tonne-miles or represent a temporary shock to the system. The answer, it seems, is nuanced. While geopolitical disruptions have clearly raised the baseline level of inefficiency within the global energy shipping system, the Panel explained that the effect is unlikely to be permanent. The expected "Venezuela reset" in early 2026 could redirect heavy crude flows back toward the United States and Europe, reducing the share of dark fleet shipments to China and supporting demand for mainstream Aframax and Suezmax tankers. At the same time, structural changes in the global refining system, with refining capacity expanding in the East while demand remains concentrated in the West, mean that product tanker tonne-miles are likely to remain higher than in the 2010s, even in the absence of active geopolitical disruptions.

The impact of disruptions in the Middle East on prices and shipping flows was also explored. Restricted access through the Strait of Hormuz has placed significant pressure on global energy shipping routes, driving LNG tanker rates to eye-watering levels of up to $300,000 per day. Wider disruptions to regional energy infrastructure have compounded the issue, removing significant volumes from the market and forcing buyers to seek alternative sources.

The Panel drew attention to a recent development in which a vessel was transited out of the Strait of Hormuz under US naval escort. The Panel highlighted the importance of monitoring whether this event opens the door for further vessels to transit through the Strait safely, or whether it will prove to be an isolated occurrence. The Panel noted that certain "dark" vessels (for example, Iranian-flagged ships willing to accept the associated risk) continue to transit through the Strait, but for other operators, the US naval escort may present a welcome opportunity to move vessels out of the region. If the Strait of Hormuz remains largely inaccessible, the Panel raised the possibility that transiting through the Red Sea could serve as a short-term alternative route, though it cautioned that the longer-term viability of this option remains uncertain. This observation reinforced the Panel's broader theme that the shipping industry must remain agile and prepared for a rapidly shifting geopolitical landscape.