Iran rejects Trump's Hormuz control claim as traffic sinks 90%

Iran said the Strait of Hormuz remains blocked and will not reopen until its conditions are met, contradicting President Donald Trump's "total control" claim as vessel traffic through the world's most critical oil chokepoint sinks to near three-month lows.

"Claims and repeated posts by U.S. officials that the Strait of Hormuz is no longer blocked do not change the reality: the Strait of Hormuz remains blocked and will not be reopened until Iran's conditions are accepted," the Persian Strait Gulf Authority said in a post on X.

Vessel transits through the waterway, which handles roughly a fifth of global oil trade, sat at a five-day average of about 13 on Tuesday — nearly 90 percent below the pre-war daily average of 130 ships, according to trade intelligence firm Kpler. Brent crude futures settled at $89 a barrel, with West Texas Intermediate near $84, as both sides hardened their negotiating stances.

The standoff is feeding into American pump prices, with the national average for a gallon of regular unleaded gasoline at $4.03 — about 90 cents higher than a year earlier, according to AAA. The U.S. Energy Information Administration forecasts continued severe constraints on Hormuz transits through August, with crude production in the region expected to return to pre-conflict averages early next year.

A 9 Million Barrel Dispute

Energy Secretary Chris Wright pushed back on Iran's claims, saying oil shipments through the strait have climbed to nearly 9 million barrels a day and that total volumes leaving the Arabian Gulf region have risen above pre-conflict averages. Independent analysts dispute that figure. Most experts put the actual volume at 4 million to 6 million barrels a day, according to Bloomberg commodity analyst Javier Blas — a gap equal to roughly 4 percent of global oil output.

The discrepancy matters because it determines how much of the supply shock markets are pricing in. Obsidian Research's Brett Erickson said a substantial amount of oil is still reaching global buyers, though at higher cost and under the threat of Iranian strikes, but found no evidence to back the 9 million barrel-a-day claim. The UAE's Adnoc has run a shuttle service to the Fujairah anchorage to keep crude moving, at considerable expense — its fleet has been attacked 15 times.

Iran's Conditions and the Path to Reopening

Iran's Supreme National Security Council laid out sweeping demands over the weekend for reopening the strait, including an end to the U.S. naval blockade, sanctions relief, American troop withdrawals and war reparations. Mohsen Rezaei, the council's head, said the waterway would stay shut until Washington terminates the conflict and blockade, unfreezes Iranian assets and consents to a regional ceasefire covering Lebanon and Gaza.

The Gaza demand may prove difficult to satisfy, since Israeli Prime Minister Benjamin Netanyahu has rejected the newest American peace initiative. Rezaei also drew a line between separate Omani and U.S. negotiation channels, saying any pact between Iran and Oman on jointly managing the strait — including a proposed toll structure — would stand apart from the question of reopening it.

Pakistan, which has served as mediator, said it continues to engage with the parties with "a fair degree of optimism." Trump, for his part, doubled down on Truth Social, calling the blockade "a wall of steel" that "there is nothing Iran can do about." Mohammad Reza Naqdi, a top advisor to the commander of Iran's Islamic Revolutionary Guard Corps, told PBS that "victory is on our side" and that the U.S. military is "weaker than what we perceived," saying Iran's goal is to attain deterrence by prolonging the conflict and imposing attrition costs.

The collapse in traffic — from a pre-war average of 130 ships a day to roughly 13 — shows the scale of the disruption to a waterway that carries about a fifth of global oil trade. With both sides demanding reparations and no ceasefire in sight, the risk premium embedded in crude looks set to persist through the third quarter, keeping pressure on pump prices into the fall.

This article is for informational purposes only and does not constitute investment advice.