Why Shipping Corporation and GE Shipping Shares Jumped 10% Amid Israel-Iran Conflict

Shipping stocks were surging during the early morning trade on Friday, June 13, 2025, due to high demand, outperforming a weak broader market, as tensions escalate in the Middle East sparking fears of global trade disruptions and rising rates of tankers.

The shares of Shipping Corporation of India and GE Shipping surged up to 10% as the two companies emerged as the top gainers on the Nifty 500 index.

Investor Sentiment

The investor sentiment for shipping stocks remained strong through expectations of higher freight and tanker rates, as ships are most likely going to reroute to avoid the Strait of Hormuz - which is a critical route for global oil and gas transport.

Israel-Iran Conflict

Israel made a pre-emptive strike on the nuclear sites located in Iran and this has reportedly killed several top commanders and scientists.

Israel's move comes as the two month deadline set by the United States President Donald Trump, for a nuclear deal with Iran expired.

Recently, the UN nuclear watchdog had passed a resolution accusing Iran of violating non-proliferation commitments, prompting Iran to pledge an acceleration in its nuclear program.

The Strait of Hormuz, is a narrow chokepoint of a width of 21 miles and it is important for global energy supply.

It handles about 30% of seaborne oil and 20% of global LNG and any threat to this passage could send oil and freight prices soaring.

Impact On India

The impact of the closure of the Strait of Hormuz can affect the prices and shipping costs.

Since India imports more than 80% of its crude oil from Gulf nations like Iraq, Saudi Arabia, UAE, and Kuwait, the blockage of this maritime route would limit global oil supply and crude oil prices would shoot.

Further, shipping costs would also shoot up because tankers would need longer routes around Africa or completely avoid the region. This would reduce vessel availability and push freight rates higher.

Also Read: Israel-Iran Conflict: What Is Operation Rising Lion? All You Need to Know