Iran blocks the Strait of Hormuz: ceasefire collapses, oil markets on the brink of shock
June 20, 2026. The Khatam al-Anbiya Central Command — Iran's highest joint headquarters — has officially announced the closure of the Strait of Hormuz to shipping. The reason cited is violations of the Islamabad memorandum by the United States and Israel. This decision instantly nullifies the fragile truce reached just a few days ago and poses a direct threat to 20% of global oil transit.
The situation is developing rapidly. After the US and Israel struck Iranian targets in late February 2026, Tehran imposed partial restrictions on vessel passage. However, the 14-point Islamabad memorandum signed on June 17 provided for the complete lifting of the naval blockade of Iranian ports and guarantees of safe passage for commercial vessels during the first 60 days. Markets, which had already priced in de-escalation, responded with a decline in oil quotes. Now, this positive sentiment has been canceled out.
Military Command Statement: Ultimatum or Actual Blockade?
In its statement, the Khatam al-Anbiya Command emphasizes that the closure of the strait is only a "first step." Iran warns of further measures if "aggression continues." The key trigger was the continuation of Israeli actions in Lebanon, which Tehran regards as a direct violation of the memorandum. Against this backdrop, all Iranian state media are broadcasting a unified position: the truce has been broken, and the blame lies with Washington and Tel Aviv.
Oil Shock: 21 Million Barrels Per Day at Risk
Approximately 21 million barrels of oil and petroleum products are transported through the Strait of Hormuz daily — roughly a quarter of all global seaborne oil trade and 20% of the world's liquid hydrocarbon consumption. Additionally, major export shipments of liquefied natural gas from Qatar and the UAE pass through the strait. Alternative routes for Gulf countries are virtually nonexistent, making any disruption in this region a catalyst for price volatility.
The Islamabad Memorandum: A Hope That Fell Short
Signed just three days ago, the memorandum stipulated that Iran would make "maximum efforts for the safe and free passage of commercial vessels." The document also called for the cessation of the US naval blockade of Iranian ports. Vessel traffic had begun to recover, helping to lower energy prices. However, the current statement from the Iranian military effectively nullifies all these agreements.
Notably, US Vice President JD Vance has already issued a denial, stating the opposite — that the strait remains open. There is no official confirmation of a blockade yet, creating information chaos in the markets.
My expert assessment: Even if Iran's current statement is a tactical show of force rather than an actual blockade, the market has already received a signal about the extreme fragility of the truce. Traders should prepare for a resumption of the oil price rally. Any delay in transit through the Strait of Hormuz could trigger a supply deficit that the market cannot compensate for in the short term. For the cryptocurrency market, this is a classic "risk-off" scenario: a flight to stablecoins and a decline in altcoins, but possibly a short-term rally in Bitcoin as a hedge against geopolitical uncertainty.