The core event centers on the ongoing disruption of oil tanker traffic through the Strait of Hormuz following a fragile ceasefire between the U.S. and Iran, which was announced Tuesday evening amid the U.S.-Israel war in Iran [1]. Kevin Hassett, director of the White House's National Economic Council, emphasized that even a single oil tanker passing through the strait would provide a 'huge chunk' of the missing global supply, given the current supply crunch [1]. Prior to the conflict, over 100 commercial vessels, mostly oil tankers, transited the strait daily, carrying about 20 million barrels of oil per day, which accounted for 20% of the world's oil supply [1]. Since the war began on February 28, only two tankers and a handful of bulk carriers have passed through the waterway during the two-week ceasefire, according to Matt Smith, Kpler's lead oil analyst [1]. This limited traffic has persisted throughout the conflict, with Iran maintaining leverage despite enduring military strikes from the U.S. and Israel [1].
The blockage of the strait has caused global energy prices to surge, with oil prices initially falling sharply after the ceasefire announcement but rebounding above $100 per barrel on Thursday [1]. Hassett noted that Iran has agreed to open the strait and allow more ships through, but actual traffic remains minimal, and the situation is being closely monitored [1]. He highlighted that a single large tanker could carry 2 million barrels, which would significantly alleviate the supply shortage [1].
Amena Bakr, a Middle East and OPEC expert at Kpler, stated that hundreds of millions of barrels have been removed from the market due to the inability to ship oil out of the Persian Gulf since the war began [1]. Hassett indicated that negotiations are set to begin this weekend in Islamabad, Pakistan, and expressed optimism that a final agreement could be reached, contingent on Iran's cooperation [1]. Defense Secretary Pete Hegseth asserted that the strait is open, while White House press secretary Karoline Leavitt reported an uptick in traffic, though concrete numbers remain low [1].
Market participants are watching the situation closely, as the outcome of upcoming negotiations could determine whether oil flows return to normal levels and ease price volatility [1].
CONCLUSION
Oil tanker traffic through the Strait of Hormuz remains severely restricted despite a ceasefire and promises to reopen the route, keeping global energy prices elevated. The market is awaiting clarity from upcoming negotiations in Islamabad, which could determine whether oil supply disruptions are resolved. Until then, uncertainty persists and the situation continues to exert significant pressure on oil prices.