Closed and open, open and closed, what is the situation in the Strait of Hormuz

In the past two days, Iran first announced the opening of the Strait of Hormuz. US President Trump expressed “thanks,” but soon posted again that “the maritime blockade against Iran will continue to be in effect.” In less than 24 hours, Iran reversed its attitude and announced that it would resume control of this major global energy transportation route. Trump responded that Iran cannot “blackmail” the US.

“Good news”: the Strait of Hormuz is “fully open”

The Strait of Hormuz carries about a quarter of the world's seaborne oil trade and the transportation of large quantities of liquefied natural gas and chemical fertilizer.

At about 16:15 Tehran time on the 17th (about 8:45 EST), Iranian Foreign Minister Alagzi announced on social media that in view of the cease-fire between Lebanon and Israel, the Strait of Hormuz was completely open to all merchant ships during the cease-fire period, and the route of passage was in accordance with the coordinated route previously announced by Iran's ports and the IMO.

About 20 minutes later, Trump posted on social media confirming Iran's opening of the Strait of Hormuz. “Iran has just announced that the 'Iran Strait' is fully open and fully passable. Thank you!”

After Alagezi announced the “opening” of the Strait of Hormuz to merchant ships, international crude oil futures prices fell rapidly due to this news, falling by more than 10%.

On the morning of the 17th EST, the intraday price of light crude oil futures for May delivery on the New York Mercantile Exchange fell to $84.48 per barrel, a drop of more than 12% compared to the closing price of the previous trading day. Meanwhile, the lowest price of London Brent crude oil futures for June delivery fell to 88.76 US dollars per barrel, a drop of more than 10% compared to the closing price of the previous trading day.

As a result, international gold and silver prices have risen sharply. Just 5 minutes after the news of the “opening” of the Strait of Hormuz was released, the spot gold price rose to 4890.78 US dollars per ounce. On the morning of the 17th EST, gold futures on the New York Mercantile Exchange rose close to 2% in June, and silver futures rose by more than 4% in May.

Variable: US and Iran each say their own words

After “thanking” Iran for opening the Strait of Hormuz, Trump soon posted again that “the maritime blockade against Iran will continue to be in effect.” In a subsequent post, Trump said that Iran has agreed not to close the Strait of Hormuz and “has or is” clearing all mines with US assistance. The US will receive all of Iran's nuclear “dust” and will not pay any money in any way or form.

Public opinion has noticed that Trump posted several posts in a row within an hour, which can be summed up to the effect that the US and Iran are talking very well; they are all concessions made by Iran. Trump was also interviewed by various media on the same day to restate these arguments.

Iran made a tough statement about the continued US naval blockade. Iranian Foreign Ministry spokesman Bagae said that Iran sees the US maritime blockade against it as a violation of the cease-fire agreement, and if the blockade continues, Iran will take necessary countermeasures. Bagae also said that Iran has rejected the plan to ship its enriched uranium abroad.

On the evening of the 17th, the Islamic Revolutionary Guard Corps Naval Command of Iran posted new regulations for the passage of ships in the Strait of Hormuz on social media: first, civilian ships must pass through Iran's designated routes; second, military vessels are still prohibited from passing through; third, all vessel traffic must be coordinated with the Islamic Revolutionary Guard Corps Navy.

Islamic Parliament Speaker Kalibaf said that the 7 statements Trump posted on social media within 1 hour were “untrue.” The US side was unable to win the war by relying on lies, and it is doomed to gain nothing in negotiations.

The US Axios News website reported on the 17th that the US and Iran are currently negotiating a 3-page cease-fire memorandum of understanding, which includes the US unfreezing 20 billion US dollars of Iranian funds in exchange for Iran's abandonment of enriched uranium stocks. According to a compromise proposal currently being discussed, some of the highly enriched uranium would be shipped to a third country, not necessarily the United States.

New news: The Strait of Hormuz is “closed again”

A spokesman for the central headquarters of the Iranian armed forces in Hattam Ambia said on the 18th that the US “has repeatedly broken promises and continued to carry out acts of maritime robbery under the guise of a so-called blockade. As a result, (Iran's) control of the Strait of Hormuz has returned to its previous state, and this strategic route is currently under strict control by Iran's armed forces.” The spokesperson said that unless the US allows Iranian ships to pass completely freely, Iran will continue to strictly control the Strait of Hormuz.

Iran's Supreme National Security Council Secretariat issued a statement later that day saying that Iran is determined to control the passage of the Strait of Hormuz until the war is completely over and lasting peace is achieved in the region. Furthermore, after Pakistan's senior military officials visited Iran, the US put forward new proposals. Iran is considering these recommendations and has yet to respond to them.

Ships have once again been attacked in the Strait of Hormuz. Maritime News's “Tanker Tracker” website posted on social media on the 18th that two Indian ships trying to cross the Strait of Hormuz were driven back by the Islamic Revolutionary Guard Corps Navy of Iran, and there were fires during that time. The British Maritime Trade Operations Office has also issued several notices saying that it has received reports of attacks on ships near the Strait of Hormuz.

According to ship tracking data, about 10 ships tried to pass through the Strait of Hormuz on the 18th, but eventually turned back. The shipping trajectory shows that several ships returned after traveling to the waters near Iran's Larak Island. According to the data, most of these ships are oil tankers, and the destination of many of the ships in the automatic identification system is India.

In response to Iran's announcement to resume control of passage through the Strait of Hormuz, Trump said on the 18th, “We are talking to them. They also want to block the strait, but Iran cannot blackmail us. There will be news before the end of today”.

The US “Wall Street Journal” reported on the 18th that the US military plans to board and seize Iranian-linked oil tankers and merchant ships sailing in international waters within the next few days to expand the scope of its naval attack operations beyond the Middle East.

Iran's Supreme Leader Mujtaba Khamenei issued a written statement on the occasion of the Islamic Republic of Iran Army Day on the 18th saying that the Iranian Navy is ready to go and is ready to inflict a “new fiasco” on the enemy.

This article is reprinted from the WeChat account “Xinhua International Headlines”, Zhitong Finance Editor: Chen Siyu.