Iran blocks the Strait of Hormuz: the fragile truce collapses
On June 20, 2026, the Khatam al-Anbiya Central Command announced the closure of the Strait of Hormuz to shipping. The reason cited was violations of the Islamabad Memorandum by the United States and Israel.
This decision directly contradicts recent de-escalation efforts and once again creates serious risks for global oil transit, while markets had already priced in reduced tensions.
Statement from the Military Command
The Khatam al-Anbiya Central Command—Iran's highest joint headquarters—described the closure as a "first step" and warned of further measures if aggression continues. The statement was reported by all major Iranian state media.
It is worth recalling that the conflict escalated after strikes by the United States and Israel in late February 2026 and the imposition of earlier restrictions on passage through the strait.
Approximately 21 million barrels of oil and petroleum products are transported daily through the Strait of Hormuz, accounting for about 20% of global liquid hydrocarbon consumption and roughly a quarter of all seaborne oil trade. These estimates come from the U.S. Energy Information Administration. In addition to oil, major export shipments of liquefied natural gas from Qatar and the UAE pass through the strait. Any disruptions in this region invariably increase price volatility, as alternative routes for Gulf countries are virtually nonexistent.
Disagreements over the Islamabad Memorandum
The 14-point Islamabad Memorandum, agreed upon around June 17, 2026, stipulated that Iran would make maximum efforts to ensure the safe and free passage of commercial vessels for the first 60 days. The plan also called for the lifting of the U.S. naval blockade of Iranian ports. Ship traffic began to recover after this agreement was reached, helping to lower energy prices.
The new statement from the Iranian military effectively nullifies the passage agreements and views Israel's ongoing actions in Lebanon as a violation of the memorandum.
Previously, the memorandum quickly led to a drop in oil prices, but the current situation may once again draw attention to supply issues amid a potential prolonged supply shock. However, the closure of the Strait of Hormuz has not yet been officially confirmed—U.S. Vice President JD Vance has indicated the opposite.
Analytical Commentary: Iran's statement is a classic tool of geopolitical pressure, used to renegotiate the terms of a deal. The market, which has already priced in "peace dividends," will now face a new wave of uncertainty. In the short term, this could trigger a sharp spike in oil prices and, consequently, increase volatility in cryptocurrency markets. However, a complete and long-term closure of the strait is unlikely—it would be an act of economic war, the consequences of which would be catastrophic for Iran itself.