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A ceasefire framework, a fragile relapse, and an oil market that moved faster than the forecasters. Why energy and legal teams should plan for prolonged uncertainty rather than a clean resolution.

The Strait of Hormuz carried about a fifth of the world’s seaborne oil before Iran closed it in late February. The closure pushed Brent crude above $100 per barrel for the first time in nearly four years and stranded roughly 2,000 ships in the Persian Gulf. Four months on, the crisis hasn’t resolved and hasn’t returned to its peak. It has settled into something harder to plan around: a stop-and-start normalization that whipsaws prices week to week and leaves businesses managing a live risk rather than a finished event.

Where things actually stand, as opposed to where the headlines suggest, matters for any company with exposure to oil prices, shipping costs, supply contracts, or force majeure provisions tied to this conflict.

From Closure to Ceasefire to Relapse

The conflict began February 28, when the United States and Israel launched air operations against Iran. Iran’s Revolutionary Guard Corps Navy responded by blocking tanker traffic through the strait, attacking merchant vessels, and laying sea mines. At the worst point, an estimated 14 million barrels per day of oil output was shut in, about 14 percent of global demand, and vessel traffic through the strait fell more than 90 percent. Brent reached $114 per barrel on March 27. That was the largest single-month price increase in the history of oil markets.

On June 17, the United States and Iran signed a memorandum of understanding intended to end the conflict. Iran agreed to end its closure of the strait. The United States agreed to lift its naval blockade of Iranian ports, with other terms left to follow-on technical talks. The early signs were good. U.S. officials confirmed that 16 million barrels of oil transited the strait in a single day on June 21, more than moved through it before the war, and a single-day record of roughly 20 million barrels followed shortly after.

The recovery didn’t hold. On June 20, Iran’s IRGC military command declared the strait closed again, citing continued Israeli strikes in southern Lebanon as a ceasefire violation. Iran’s foreign ministry contradicted its own military within hours, telling state media that shipping was operating normally, while U.S. Central Command reported that traffic was continuing largely uninterrupted. That gap between official statements and observable data has become the defining feature of this phase. Transit figures from commercial trackers like MarineTraffic and Kpler have repeatedly diverged from U.S. military counts, and some analysts believe the difference reflects vessels switching off their tracking transponders while still moving through the strait.

A cargo vessel was struck by an unidentified projectile near the Omani coast on June 25 while attempting the transit, and the International Maritime Organization paused a planned evacuation of several hundred vessels still stranded in the Gulf. The strait’s daily crossing counts tell the story in miniature: 76 transits on June 24, falling to 24 within a week as attacks and warnings mounted, then recovering to 40 as talks resumed. Brent, which the EIA’s June forecast had projected to average around $105 per barrel through the summer on the assumption the strait would stay effectively closed, instead fell to roughly $73 by early July, its lowest level in four months. Analysts cut their price forecasts for the first time since the war began.

Why Prices Fell While the Strait Stayed Unsettled

Brent is now trading at levels last seen in early March, even though the strait remains only partially and unpredictably open. Several supply-side facts explain the move. Tankers carrying roughly 35 million barrels that had been stuck in the Persian Gulf have exited through the strait since the ceasefire agreement. Previously stranded supertankers have resumed passage. And the market is pricing in the eventual return of Gulf supply at the same time that other producers, including the United States, have kept output elevated through the disruption.

The gap between the EIA’s $105 forecast and the $73 the market actually trades at measures how much faster diplomacy moved than forecasters expected. It also measures the downside still priced in if the talks fail.

The disruption shifted trade flows and export revenues unevenly. An analysis comparing fuel shipment values during the conflict against the same period a year earlier found the United States saw export revenue rise by about $50 billion, while Russia, whose exports avoided the bottleneck, gained more than $15 billion. Persian Gulf nations saw export volumes fall across the board. Saudi Arabia and Oman still posted revenue gains, Saudi Arabia by redirecting volumes through pipelines to the Red Sea, Oman because its ports sit outside the strait entirely.

The EIA assumes shipments through the strait resume more fully in the third quarter, cautions that reaching pre-conflict traffic will take several months beyond that, and doesn’t expect full normalization until early 2027. Some Middle East production may stay offline past the forecast window entirely. As of May, Middle East producers were still pumping more than 11 million barrels per day below pre-conflict levels.

Refined Products Took the Harder Hit

The crude story understates what happened to refined products, which is where most businesses actually feel fuel costs. The EIA’s June outlook projects wholesale diesel and jet fuel prices will rise more than 60 percent and 40 percent respectively in 2026 compared with its pre-conflict February forecast. Wholesale gasoline is projected to rise about 50 percent against the same baseline. Crude price increases and disrupted product flows compounded each other.

The dislocation also redirected global demand toward U.S. supply. U.S. crude oil and petroleum product net exports hit a record 5.8 million barrels per day in April, with May holding close to that level, as buyers filled the gap left by reduced Middle East shipments. The EIA expects U.S. diesel and jet fuel net exports to rise further in the second quarter compared with the same quarter last year.

What This Means for Energy Companies and General Counsel

The crisis hasn’t ended. It has changed character, and the legal questions changed with it. Force majeure analysis in the spring turned on an acute, ongoing closure. The harder question now is how supply contracts, shipping agreements, and pricing formulas handle a chokepoint that opens, closes, and reopens on a timeline set by negotiations and battlefield events, with no reliable warning of which state it will be in next week.

Contracts that define force majeure around a binary event (the strait is open or it’s closed) may not map onto a situation where Iran’s foreign ministry and military contradict each other in the same news cycle and where U.S. and commercial tracking data disagree about how many vessels transited on a given day. Companies relying on force majeure protection tied to specific, verifiable conditions should check whether their contract language anticipates ambiguous, intermittent disruption or only the clean closure scenario of the war’s opening weeks.

For companies with pricing formulas tied to Brent or WTI, the round trip from the March peak to the July trough, roughly 35 percent, makes the case for price collars, averaging mechanisms, or renegotiation triggers tied to extended volatility windows. For companies that ship through or near the strait, insurance terms, routing flexibility, and contingency planning for renewed closure should stay on the active list. None of that was resolved when the June 17 memorandum was signed.

The Next Sixty Days

Events in late June and early July showed what the coming months will probably look like. The United States and Iran exchanged military strikes on June 28. Within days, the two sides held two days of indirect talks in Doha, which Qatar’s foreign ministry said made positive progress on strait traffic and frozen assets without a breakthrough on the harder questions. Those talks are paused until funeral ceremonies in Iran conclude on July 9.

The most concrete open issue for shipping is tolls. Iran has said it will begin charging vessels transiting the strait in mid-August, when the agreement’s 60-day toll-free period expires. The United States has rejected any Iranian tolling. Iran also warned on July 2 that vessels must follow Tehran-designated routes or face a military response. Mid-August is now a specific date worth marking: if the toll dispute isn’t resolved by then, shipping costs and transit patterns through the strait change again.

Escalation and de-escalation within the same week has become the pattern. Businesses should plan for that pattern to continue, and treat no single development, good or bad, as the conflict’s final word.