Hormuz Tensions Escalate
Second Tanker Attack in Hormuz Strait Raises Tensions, Navies Elevate Threat Level
A supertanker carrying 2 million barrels of Qatari oil was struck in the Strait of Hormuz on Saturday, the second attack on a merchant ship in three days. The Panama-flagged VLCC KIKU took a hit to its bridge at around 08:00 GMT, according to UKMTO. No environmental damage was reported, and the crew survived.
The attack came just ten days after the U.S. and Iran signed an interim peace deal meant to reopen the Strait. Now, the Joint Maritime Information Center has raised its threat level for ships in the region to "Substantial." The Strait carries roughly 20% of the world's oil supply, according to Bloomberg.
A Fragile Peace Deal Unravels in Days
On June 17, President Trump and Iranian leadership signed a Memorandum of Understanding at the Palace of Versailles. The deal was meant to hold for 60 days while both sides negotiated a final agreement on Iran's nuclear program and sanctions. The Joint Maritime Information Center downgraded the regional threat level to "Moderate" the same day, according to CFR.
The peace lasted barely a week. On June 25, an IRGC drone struck the Singapore-flagged container ship M/V Ever Lovely, 7.5 nautical miles off Oman. The U.S. launched retaliatory airstrikes on Iranian missile and radar sites the next day, according to The Guardian. Iran's Revolutionary Guard then announced strikes on "American positions in the Gulf." Bahrain reported a drone attack on its territory the same evening, according to AFP.
80 Mines and 11,000 Stranded Sailors Block the Strait
The International Maritime Organization warns that roughly 80 high-explosive mines — primarily Maham 3 and Maham 7 models — are laid in the Strait's main shipping lane. The mines are described as "sonar-resistant," making them hard to clear, according to gCaptain. The IMO has paused a plan to evacuate 11,000 seafarers stranded on vessels in the Persian Gulf because of the renewed attacks.
Iran and Oman are also fighting over which route ships should use. Oman and the IMO set up a "Southern Corridor" to avoid the mined zone. Iran insists ships must use its designated "Northern Corridor" and has warned that vessels using the Omani route will not be protected, according to Al Jazeera.
Oil Prices Edge Up as Asia Braces for Disruption
Brent crude has swung between $72 and $75 per barrel this week. Analysts warn prices could top $85 if the Strait stays disrupted for more than 72 hours, according to CBS News. On Wednesday, 78 vessels transited the Strait — the highest daily count since the war began in February, but still well below the pre-war average of 130 or more per day, according to Lloyd's List Intelligence.
The KIKU strike is especially alarming for Asian energy buyers. Qatar had only recently resumed crude and LNG sales to India, Taiwan, and Japan after the Strait reopened on June 15, according to Energy Connects. Continued attacks could force those countries to buy more expensive oil from the Atlantic Basin instead.
Washington and Tehran Trade Blame Over Who Broke the Deal
President Trump said Iran "violated the ceasefire agreement" and authorized retaliatory strikes. Vice President JD Vance warned on X: "Violence will be met with violence. If they have disagreements about how the MoU is being applied, they can pick up the phone," according to Fox News. Secretary of State Marco Rubio separately rejected Iran's push to charge "maritime service fees" for ships passing through the Strait, calling it illegal under international law.
Iran's Foreign Ministry fired back, calling U.S. airstrikes "a blatant violation of the MoU" and arguing that Washington failed to deliver promised sanctions relief first. CFR analyst Michael Froman had warned early on that the agreement deferred the "thorniest details," creating space for exactly this kind of breakdown, according to CFR.
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