Full Breakdown
Deal to Reopen the Strait of Hormuz Amid U.S.–Iran Negotiations
5/24/2026, 11:50:47 PM
Deal to Reopen the Strait of Hormuz
U.S. and Iranian officials signaled on May 24 that a memorandum of understanding to restore traffic through the Strait of Hormuz was “largely negotiated.” The announcement followed a brief AIS blackout near Fujairah and the loading of a 1.35-million-barrel VLCC for South Korea, indicating movement toward normalizing the chokepoint.
Background: War and Blockade
The strait, carrying one-fifth of oil, was sealed after Iran’s Revolutionary Guard Navy deployed fast boats, mines, and drones following a U.S.–Israel offensive. The closure forced tankers onto the Cape of Good Hope route, inflating freight costs and pushing Brent crude above $100 per barrel.
Data & Statistics
Kpler estimates 166 tankers—about 170 million barrels—remain anchored in the Persian Gulf, while regional oil output fell by 12 million barrels per day and refined product flow by 3 million barrels per day. Brent hovers near $100 a barrel, with a $94 floor since mid-March; JPMorgan sees $97 average for 2026.
Official Statements & Responses
President Donald Trump announced that peace with Iran is at hand and the strait will reopen. Iran’s military spokesperson said Tehran will retain full control over Hormuz even after any agreement. CITIC Securities said markets have already priced the deal as the baseline scenario.
Criticism & Opposition
Energy analysts warn Trump’s optimism may be premature, citing Iran’s demand for sovereign tolls and its insistence on controlling transit routes. Insurance firms have raised marine premiums by thousands of percent, and some shippers remain reluctant to risk AIS-blackout zones or mining of the strait.
On-the-Ground Reports
Dozens of tankers waited near the strait in early May; Windward AI later reported an AIS blackout off Fujairah on May 24, noting vessels “in the area, loading less, and a meaningful number…gone dark.”
Conflicting Reports & Gaps
Kpler projects a three-month window to restore full tanker capacity, while JPMorgan expects the strait to reopen by early June. Iran’s state news agency stresses that “free passage” will not be restored, creating a gap between commercial expectations and Tehran’s sovereignty claims. Detailed damage assessments for regional refineries remain scarce.
Verbatim Quotes
- “Fujairah goes dark: AIS transmissions collapse after Iran’s PGSA announcement,” — Windward AI
- “Vessels are still in the area. They are loading less, and a meaningful number have gone dark,” — Windward AI
- “Now Hormuz is Iran’s main non-nuclear leverage tool,” — Alex Vatanka, Middle East Institute
- “President Donald Trump on Saturday said that peace with Iran is at hand and the Strait of Hormuz will reopen.” — Donald Trump, U.S. President
What’s Next
Analysts expect the first wave of vessels to transit the strait in early June, contingent on Iran’s issuance of maritime licenses. Monitoring will focus on AIS activity, insurance pricing, and any renewed Iranian toll demands. The pace of regional oil-field repairs and refinery restarts will shape oil-price trajectories through the end of 2026.
