Has the Strait of Hormuz really opened? This is how it looks in the field

The price of oil fell on Friday and Wall Street indices closed at a record high after the market interpreted the announcement from Tehran as a significant breakthrough that will ease the huge disruption in global energy supply.

But statements by Iranian officials and President Donald Trump have caused confusion as to whether the strait is really open or not.

The Iranian Foreign Minister, Seyed Abbas Araqchi, initially said that the strait was “completely open” for the remainder of the cease-fire with the US and Israel. But Iranian media, in cooperation with the Revolutionary Guards, published conditions for safe passage similar to the rules that Tehran had been imposing for weeks. Trump, for his part, announced that he would lift the blockade he had imposed except for vessels from Iran, which in response announced that it was a violation of the cease-fire.

“There is no dramatic change here”

A number of tankers and cargo ships tried to exit the strait after that through the route established by Iran around Lark Island, but they suddenly turned back, said Matt Smith, director of commodity research at Kepler. “Obviously we didn’t give them permission to move,” Smith said.

“Commercial ships must follow a route set by Tehran and coordinate with its military,” a source close to Iran’s Supreme National Security Council told Tasnim News. “Ships are not allowed to pass if they or their cargo is connected to hostile countries.”

“It is not clear if there is a dramatic change here,” said Tomer Raanan, a maritime risk analyst at the intelligence company Lloyd’s List.

The strait remains functionally closed, added Matthew Wright, senior shipping analyst at Kpler.

Confirmation of the situation also comes from the world’s largest shipping association, BIMCO, which advised vessels on Friday to avoid the strait due to the mine threat. The area “has not been declared safe for passage at this time,” said Jacob Larsen, BIMCO’s chief security officer.

Either way, the markets drew significant encouragement from the announcements that sent Wall Street into a dramatic trading day. The Dow Jones climbed 1,005 points, registering an increase of 2.1%. The S&P 500 rose 1.3% and broke above 7,100 points for the first time in history. Nasdaq rose by 1.5% – both to new all-time highs. Russell 2000 also broke to a new high. Oil prices fell by about 10% to the lowest level in a month and a half of about 83 dollars per barrel of the WTI type.