Nearly Tk 17.5 million for crossing the Strait of Hormuz!

The monthly salary of a captain navigating an oil tanker through the Strait of Hormuz has reached $100,000. Each time a captain crosses the strait, another $50,000 is credited to their account as a risk bonus. This means that if a captain crosses the dangerous Strait of Hormuz just once in a month, their total earnings reach $150,000. That amounts to nearly Tk 18.5 million in Bangladeshi currency, calculated at Tk 123 per dollar. This monthly salary and benefits package sets an unprecedented new record in the maritime sector.

Under normal circumstances, an experienced captain navigating the Strait of Hormuz earned a basic monthly salary of $15,000, equivalent to Tk 1.8 million. However, under the current circumstances, that income has suddenly increased almost tenfold to an unimaginable level. The increase is not limited to captains. Ordinary sailors, whose usual monthly salary is $1,500, are also earning up to six times more when entering the Strait of Hormuz and the Gulf of Oman.

The Strait of Hormuz is one of the world’s most important shipping routes. Approximately 25% of global energy commodity shipments pass through this 191-kilometer-long strait. Crossing it takes six hours.

The question now is why salaries have risen so sharply and how shipowners and operators are paying such enormous amounts. The main reason is soaring global oil prices. Supply disruptions caused by the US Iran war have pushed demand to its peak. The soaring salaries and additional risk allowances for sailors are ultimately adding to the prices of crude oil and other commodities in international markets. Ordinary citizens in Bangladesh and other Asian countries are bearing the cost. Shipowners and operators are recovering these enormous expenses by raising spot freight rates several times over.

Captain Anam Chowdhury, president of the Bangladesh Merchant Marine Officers Association, said, “If a sailor wants to cross the Strait of Hormuz voluntarily despite knowing the risks, there is no objection. However, it is also necessary to consider whether sailors are being forced to cross this death trap.”

Sailors from the Philippines, India and China are taking advantage of the opportunity to earn unusually high amounts by crossing the Strait of Hormuz. No Bangladeshi sailors have been identified on this list.

Amid military conflicts and drone and missile attacks in the Middle East, shipping traffic through the strait has plummeted. Navigation along this route has become extremely dangerous and resembles a death trap. When the three-way US, Israeli and Iranian attacks began at the end of February this year, Tehran nearly closed the strait. It also attacked vessels moving through the waterway without permission. In response, the United States imposed a naval blockade on Iranian ports. Amid these retaliatory measures, attacks on oil tankers reached their highest-level last week.

According to Windward, there have been 16 attacks in the Gulf over the past 10 days. Despite these risks, influential oil trading and supplying countries around the world are making every possible effort to keep shipping operations running, even on a limited scale. In September, many vessels risked crossing the Strait of Hormuz amid opportunities for peace talks between Iran and the United States. Against this backdrop, shipping lines based in Greece, Europe and the Middle East offered captains record salaries and risk allowances.

How are shipping lines paying such enormous salaries and bonuses for crossing the Strait of Hormuz? Captain Habibur Rahman provided an answer. He said, “The daily charter rate for vessels crossing the Strait of Hormuz is now approximately $1.3 million, compared with $20,000 to $50,000 last year. On a large tanker, a $50,000 bonus adds only a few cents per barrel. As a result, although bonuses and allowances have reached record levels, shipping lines and suppliers are not suffering financial losses.”

The main reason sailors accept these substantial financial incentives despite knowing the risks to their lives is the opportunity to increase their long-term savings and earn a large lump sum. Under international maritime regulations, sailors cannot be forced to enter war zones or high-risk areas. Even so, many find it difficult to resist the prospect of enormous salaries and bonuses. The reality, however, is that sailors may also face implicit pressure to keep their jobs if they reject an offer from a ship operator.

According to Reuters and other maritime security monitoring agencies, captains continue to experience extreme fear even after receiving increased bonuses. To avoid attacks in the Strait of Hormuz, most tankers are currently traveling close to the Omani coast under cover of darkness while completely switching off their GPS and Automatic Identification System (AIS) signals.