Strait of Hormuz Is Open: So Why Hasn’t Oil Crashed Harder?

Brent crude traded at $79.46 a barrel on June 18, down roughly 30% from $112.93 a month ago, and with the Strait of Hormuz now open and ships moving again, many expected prices to fall further still. They haven’t.

The answer comes down to the forces quietly keeping a floor under crude even as supply returns.

Open Does Not Mean Flowing

Around 500 commercial vessels remain stranded inside the Persian Gulf, according to maritime intelligence firm Kpler, and the narrow strait cannot clear them at once. Hormuz shipping traffic remains a fraction of pre-war levels, with ship captains, insurers, and owners waiting for confirmed mine clearance and a return to internationally recognized transit lanes before committing their vessels.

The Energy Information Administration’s June outlook assumed Hormuz stays effectively closed through most of the summer, with oil shipments only ramping back toward pre-conflict traffic levels in early 2027.

Producers Face Their Own Timeline

Restarting oil fields shut in for over three months is not a switch that flips overnight. Claudio Galimberti, chief economist at Rystad Energy, put it plainly in a statement to the Associated Press.

“Sentiment has clearly improved. But sentiment is not the same as supply. It will take time for production to ramp back up, for logistics to normalize, and for the risk premium embedded in crude prices to dissipate.”

Economists at Capital Economics estimate energy flows could reach 80% of pre-war levels by September. Iraq, whose fields sustained deeper shut-ins, may need close to a year to fully recover.

Markets are also pricing in the possibility that the Iran deal doesn’t hold. The ongoing US Navy presence in the Gulf, combined with uncertainty over Iran’s compliance, means traders haven’t fully priced out a geopolitical disruption. That residual risk premium is acting as a price floor.