Iran has blocked the Strait of Hormuz: the ceasefire has collapsed, markets in shock
On June 20, 2026, the Central Command of Iran's Joint Staff "Khatam al-Anbiya" announced a complete blockade of the Strait of Hormuz for shipping. The official reason is systematic violations of the Islamabad Memorandum by the United States and Israel. This decision literally nullifies the fragile truce reached just a few days earlier.
This move is not just harsh rhetoric, but a direct threat to global energy flows. Markets had only just begun to price in a reduction in geopolitical tensions following the signing of the 14-point memorandum in Islamabad, but now the situation has regressed, and with much higher volatility.
The essence of the Iranian military's statement
The Central Command of "Khatam al-Anbiya," Iran's highest joint staff, called the closure of the strait a "first step" and warned of further measures if aggression continues. Iranian state media unanimously disseminated this information, emphasizing that the trigger was the US and Israeli strikes in late February 2026, as well as Israel's ongoing actions in Lebanon, which Tehran considers a direct violation of the memorandum's terms.
The stakes are incredibly high
Approximately 21 million barrels of oil and petroleum products are transported through the Strait of Hormuz daily. According to the U.S. Energy Information Administration, this accounts for roughly 20% of global liquid hydrocarbon consumption and nearly a quarter of all seaborne oil trade. In addition to oil, key exports of liquefied natural gas from Qatar and the UAE pass through the strait. There are virtually no alternative routes for Persian Gulf countries, making this region a critical node for global energy security.
The Islamabad Memorandum: from hope to collapse
Recall that the 14-point memorandum, agreed upon around June 17, 2026, stipulated that Iran would make maximum efforts for the safe and free passage of commercial vessels during the first 60 days. In return, the US was to lift the naval blockade of Iranian ports. Ship traffic began to recover, which helped temporarily lower energy prices. Now, all these agreements are de facto annulled.
Notably, there is no official confirmation of a complete closure of the strait yet. US Vice President JD Vance has already issued a denial, stating the opposite. However, the very fact of such a statement from the Iranian military command is a powerful signal for the markets.
My analysis: The oil and gas market will enter a phase of acute volatility. If the blockade is confirmed for even a few days, we will see a sharp spike in Brent crude oil prices above $100 per barrel. In the medium term, this could trigger a global energy crisis that will affect not only traditional markets but also cryptocurrencies, as miners and investors begin to reassess their risks amid declining liquidity and rising inflation expectations. Investors should prepare for a "risk-off" scenario.