Iran Blocking Strait of Hormuz Could Send Oil Prices Higher, What to Know

Crude oil futures jumped hard on July 13 after Iran's Revolutionary Guard moved to shut the Strait of Hormuz again, reigniting a conflict that a June 17 ceasefire was supposed to have settled. Brent crude surged nearly 8% to $82.03 a barrel, while West Texas Intermediate climbed the same amount to $77.10. For traders watching the broader energy complex through United States Oil Fund (AMEX:USO), the fund closed at 120.17 dollars, up 2.02% on the day, with its 52 week range of 102.42 to 154.08 showing just how far prices have already traveled this cycle. The question of whether Iran is actually blocking the Strait of Hormuz, or merely threatening to, sits at the center of every barrel priced this week.

At a Glance

• Brent crude jumped nearly 8% to $82.03 on July 13; WTI rose the same amount to $77.10
• USO closed at 120.17 dollars, up 2.02%, with RSI at 54.63
• Just six vessels crossed the Strait in a 12 hour window on July 11, down from 18 to 22 a day before fighting resumed
• About 230 loaded oil tankers are stranded in the Gulf with no place to unload
• President Trump announced a 20% toll on cargo transiting the Strait, starting July 14 at 4 p.m. EST

What Triggered the Latest Escalation

The truce that briefly calmed the region unraveled over the weekend of July 12 and 13, when U.S. forces struck more than 80 targets inside Iran. Tehran's Revolutionary Guard answered by moving to close the Strait once more, a waterway that carries roughly a quarter of the world's seaborne oil trade and a fifth of global liquefied natural gas volumes, according to the Congressional Research Service. Within hours, President Trump posted on Truth Social that Washington was reinstating what he called the Iranian blockade and would charge a 20% toll on cargo passing through, effective July 14 at 4 p.m. Eastern.

The mechanics of that toll remain murky. Trump described it as targeting only Iranian ships and buyers, framing the U.S. Navy's role as protector rather than gatekeeper, and rebranding American forces there as the guardian of the Hormuz Strait. Iran's own IRGC said the same day that the Strait was closed, full stop. U.S. Central Command insisted it remained open. Two militaries occupying the same stretch of water gave two contradictory answers, and the tanker fleet caught between them has simply stopped moving.

Is Iran Blocking the Strait of Hormuz Right Now

Traffic data leaves little ambiguity about the practical effect, even amid the rhetorical confusion. Only six vessels crossed the Strait during a 12 hour window on July 11, compared with a pre escalation pace of 18 to 22 daily transits, according to figures reported by Al Jazeera. Roughly 230 loaded tankers are now sitting inside the Gulf with no clear path to deliver their cargo. Whatever the legal status of the blockade, the physical bottleneck is real and measurable in vessel counts.

Saudi Arabia has pipeline capacity that routes around the Strait toward the Red Sea, and Oman's geography offers its own workaround. Iraq, Kuwait, Qatar and the United Arab Emirates have no such luxury. Their crude either transits Hormuz or it stays in the ground, which is precisely why any disruption there moves markets faster than almost any other geopolitical flashpoint in the commodity world.

Quick Facts

• Brent hit $114 on May 4 at the height of prior tensions, then drifted lower as the ceasefire held
• The International Maritime Organization says there is no legal basis for mandatory transit tolls
• The IMO's 40 member council, which includes the U.S., asserts transit rights cannot be suspended or impaired
• The U.S. has not attempted a naval blockade of this scale since the Cuban Missile Crisis, according to CNN

Why Iran Is Contesting the Waterway

Iran's position rests on a dispute that never got resolved even during the ceasefire: whether Hormuz constitutes fully international waters or partly Iranian territory. Tony Sycamore at IG Australia noted that ambiguity sat quietly inside the truce the entire time. Iran's foreign minister, Abbas Araghchi, took an unusual line on the toll itself, arguing on social media that Iran, not the United States, should be the one collecting payment for safe passage, calling Iran the eternal guardian of the Strait while dismissing 20% as excessive. It is an odd stance for a government also insisting it controls access to the waterway, but it hints that some diplomatic opening could still exist.

How the Standoff Feeds Through to Prices and Inflation

An 8% single session move in crude does not stay contained to energy trading desks. Gasoline, heating oil and jet fuel prices adjust quickly, and airlines, trucking companies and any business dependent on fuel costs feel the pinch almost immediately. PCE inflation was already running well above the Federal Reserve's target through the first half of 2026, and a crude spike layered on top complicates the central bank's path on rates. The proposed 20% toll compounds the pressure further, since it applies to all traffic through the Strait regardless of cargo origin, adding a flat cost increase on top of whatever risk premium is already baked into oil prices.

Saul Kavonic of MST Financial expects Iranian efforts to constrain the Strait to keep traffic below half of pre war levels for months, punctuated by further flare ups, a view reported by Al Jazeera. That outlook, paired with the legal objections raised by the IMO and the unresolved territorial dispute over the waterway itself, suggests the market will keep pricing in disruption risk well beyond this week's headlines, regardless of how quickly Washington and Tehran manage to talk again.

Frequently Asked Questions

Can Iran block the Strait of Hormuz?

Iran has the military capability to disrupt shipping through the Strait using its Revolutionary Guard naval assets, mines and coastal missile batteries, though a full physical closure against U.S. Navy presence would be difficult to sustain for long periods.

Will Iran block the Strait of Hormuz?

Iran's Revolutionary Guard has already moved to close the Strait following renewed U.S. strikes, and analysts including Saul Kavonic expect intermittent disruption to continue for months rather than a single decisive closure.

Is Iran blocking the Strait of Hormuz?

Tanker traffic data shows only six vessels crossed the Strait in a 12 hour window on July 11, down sharply from the usual 18 to 22 daily transits, indicating a severe practical disruption even as the U.S. insists the waterway remains open.

How is Iran blocking the Strait of Hormuz?

Iran's IRGC has declared the waterway closed and is restricting movement near its coastline, ports and oil terminals, leaving roughly 230 loaded tankers stranded in the Gulf without clear passage.

Why is Iran blocking the Strait of Hormuz?

The closure followed U.S. strikes on more than 80 targets inside Iran over the July 12 to 13 weekend, and it ties into a broader unresolved dispute over whether the Strait is fully international water or partly Iranian territory.