US Resumes Blockade of Iranian Ports, Oil Prices Surge

International oil prices soared Monday, with West Texas Intermediate (WTI) crude futures climbing 9.42% to $78.14 a barrel and Brent crude futures rising 9.59% to $83.30.

This significant price jump stems from the United States' decision to reimpose a naval blockade on Iran's entire coastline, ports, and oil export terminals. The blockade, set to begin Tuesday, applies to all vessels regardless of their flag, reigniting fears of renewed disruptions to energy shipments through the critical Strait of Hormuz.

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Trump re-imposed restrictions on Iran's maritime traffic, coupled with retaliatory attacks and a sharp decrease in vessel traffic through the Strait of Hormuz, have further heightened market concerns about the availability of supply in the near term.

According to the Joint Maritime Information Center, led by the U.S. Navy, the blockade will commence at 4 p.m. Eastern Time on Tuesday, having been previously lifted in mid-June. Earlier, President Donald Trump announced the reinstatement, citing renewed military conflict with Iran. He also stated that a 20% fee would be imposed on all goods transiting the Strait of Hormuz as compensation.

Analysts at Gelber & Associates noted that Trump's restrictions on maritime traffic, coupled with retaliatory attacks and a sharp decrease in vessel traffic through the Strait, have heightened market concerns about near-term supply availability. Iran's Supreme Joint Military Command has vowed to resist any U.S. attempts to transit the strait without its authorization. Meanwhile, a UN-affiliated shipping body opposes any fees on the strait, asserting no legal basis for mandatory tolls on international navigation.

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The market focus will remain on the number of tankers entering the strait. If the number of tankers decreases, it could affect crude production, so we believe risk premiums and supply disruption risks will continue to support oil prices.