06 Jul 2026
The global ship recycling market entered Week 27 of 2026 with the Gulf fleet finally moving, oil back near pre-war levels, and the US dollar replacing the war as the main pressure point across recycling destinations.
Crude flows through the Strait of Hormuz exceeded 10 million barrels per day this week under US military coordination, while roughly 550 merchant vessels are preparing to exit the Gulf, including around 200 bulk carriers. The central channel remains constrained by an estimated 80 mines, keeping traffic on the northern and southern routes for now, but the direction of travel is clear. The fleet is moving again.
Brent crude has settled near USD 71 per barrel, effectively returning to its pre-war level after touching USD 126.41 on April 30. The barrel has completed the round trip, even as US crude inventories have drawn for twelve straight weeks. Oil prices are now focused less on inventory tightness and more on reopening, normalization, and the return of Gulf flows.
Freight has adjusted, but not collapsed. The Baltic Dry Index bounced late to around 2,650 on iron ore strength, while Capesize earnings remained near USD 32,060 per day. The index gained 25% for the quarter but lost 22% for the month, showing that the war’s freight premium outlived the war briefly but is now fading.
For ship recycling, the supply picture is becoming clearer. One queue is the visible line of vessels exiting the Gulf. The other is the deferred recycling wave that the war held offshore. Older tonnage that remained trading through the conflict now has fewer reasons to stay at sea, but the monsoon and delivery windows continue to decide when vessels can reach the beaches.
Bangladesh remains at the top of the sub-continent rankings, although the Taka has moved through the upper end of its long-held band toward 123.2 to 123.3 against the US dollar. Local steel prices eased to around BDT 66,000 per ton, while Chattogram continues to show demand, available plots, and Letter of Credit support. Recent port activity included deliveries of larger gas units such as Zamrud and ERGY, reinforcing that the wave is becoming visible.
India’s Rupee gave back part of its recovery, weakening toward 95.1 to 95.2 against the US dollar despite Brent holding near USD 71. The stronger dollar has outweighed the oil tailwind for now. Alang steel softened to around INR 36,700 per ton, keeping India the lowest-priced sub-continent destination, even as Alang continues to hold the basin’s strongest compliance footprint with more than 110 valid Statements of Compliance.
Pakistan was the only sub-continent currency to strengthen, with the Rupee moving below 278 against the US dollar. June CPI eased to 11.1%, while consumer prices fell 0.3% month on month as lower oil fed into the domestic fuel complex. However, July 1 duty changes on scrap and prime steel products have introduced a new local-policy pressure point for Gadani, even as local steel remained near PKR 195,000 per ton.
Turkey remains a regulated niche market. The Lira weakened toward 46.70 against the US dollar, another record low, while Aliaga continued to price well below the sub-continent at USD 266 to USD 288 per LDT across vessel types. Turkey’s role remains driven by EU regulation and Basel Convention-linked business rather than mainstream price competition.
GMS market rankings for Week 27 place Bangladesh first, with dry bulk indications at USD 458-463 per LDT, followed by Pakistan at USD 443-448 per LDT, India at USD 418-423 per LDT, and Turkey at USD 266-268 per LDT. Tanker and container indications remain highest in Bangladesh, while Turkey continues as the lowest-priced destination.
The main story for Week 27 is the move from war-driven uncertainty to dollar-driven pressure. The Gulf fleet is exiting, oil has settled, freight is normalizing, and the deferred recycling wave is now visible. But the Indian sub-continent remains deep in the monsoon season, and beaching activity across Bangladesh, India, and Pakistan is still governed by weather and tide windows.
Fleet exits.
Oil settles.
CPI turns.
Dollar enters.
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