Hormuz blockade lifts oil

President Donald Trump said on April 12 that the United States Navy would begin blockading ships entering or leaving the Strait of Hormuz after weekend talks with Iran in Islamabad ended without a deal. (cnbc.com) United States Central Command said the blockade would start Monday at 10 a.m. Eastern time and apply to vessels entering or departing Iranian ports and coastal areas. It also said ships bound for non-Iranian ports would still be allowed to transit the strait. (cnbc.com) Oil surged as trading opened in Asia on April 13. Reuters reported West Texas Intermediate at $103.83 a barrel, up 7.5%, while Brent rose above $100 as traders priced in another shock to Gulf exports. (reuters.com) The Strait of Hormuz is the narrow sea lane between Iran and Oman that connects the Persian Gulf to the open ocean. The United States Energy Information Administration says roughly 23.2 million barrels a day moved through it in the first half of 2025, making it the world’s biggest oil chokepoint. (eia.gov) That route carries more than one-quarter of global seaborne oil trade and about one-fifth of world petroleum liquids consumption, according to the Energy Information Administration. The International Energy Agency says it is also the main export route for Saudi Arabia, Iraq, Kuwait, the United Arab Emirates, Qatar, Bahrain and Iran. (eia.gov) (iea.org) Trump said the Navy would also intercept vessels in international waters that had paid Iran a toll for safe passage. Politico reported that he paired the blockade announcement with a threat to destroy “the little that is left of Iran” after the Pakistan talks collapsed. (politico.com) Iran’s Revolutionary Guards answered with a warning of their own. Reuters reported that they said any military vessel approaching the strait would be treated as a ceasefire breach. (reuters.com) Associated Press reported that the Islamabad talks lasted about 21 hours and ended without an agreement or a next round of diplomacy. Vice President JD Vance and envoy Steve Witkoff were part of the United States delegation in Pakistan. (apnews.com) The blockade comes after weeks in which shipping through Hormuz had already slowed, insurers had pulled back, and tankers had begun avoiding the route. Reuters reported on April 13 that vessels were steering clear of the strait even before the United States operation formally began. (reuters.com) The immediate test is whether Washington can choke off Iranian-linked shipping without closing the waterway to everyone else. Oil moved above $100 before the first hour of enforcement began, showing how little room markets see for error in Hormuz now. (cnbc.com) (reuters.com)