Why Royal Caribbean Stock Popped on Friday
Key Points
Iran announced that the Strait of Hormuz is open again.
Open to oil tankers... and to cruise ships as well.
Most important to Royal Caribbean, the announcement is lowering the cost of fuel oil.
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The Strait of Hormuz is open for business! With the S&P 500 up 1.2% as of 11:50 a.m. ET, investors seem overjoyed at the news -- and none more so than shareholders of cruise line Royal Caribbean (NYSE: RCL)
Royal Caribbean stock is up 10%.
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Image source: Getty Images.
The world just got safer -- and oil just got cheaper
This morning, Iranian Foreign Minister Seyed Abbas Araghchi announced the Strait of Hormuz is open to "all commercial vessels" for the duration of Israel's ceasefire with Lebanon.
In line with the ceasefire in Lebanon, the passage for all commercial vessels through Strait of Hormuz is declared completely open for the remaining period of ceasefire, on the coordinated route as already announced by Ports and Maritime Organisation of the Islamic Rep. of Iran.
-- Seyed Abbas Araghchi (@araghchi) April 17, 2026
"All commercial vessels" certainly sounds like good news for Royal Caribbean and its cruise liners, but the good news doesn't end there. In response to the Strait's reopening, investors sold off oil stocks and oil futures, sending the cost of the fuel Royal Caribbean needs for its ships down to Davy Jones's Locker.
Or nearly so.
WTI crude oil prices fell more than 12% today, and Brent crude, the international benchmark, dropped more than 10%. Oil's not exactly "cheap" yet -- Brent still costs nearly 50% more than it did at the start of the year. Still, one big headwind hurting Royal Caribbean's stock price just slackened significantly.
What's next for Royal Caribbean stock
Mind you, this could all change in a hurry. Iran seems to have conditioned free passage through the Strait on a tenuous truce between Israel and Lebanon. President Trump says he's keeping the naval blockade on Iran in effect.
There's still a lot up in the air here. Still, with Royal Caribbean shares trading for just 17 times earnings, and analysts pegging the cruise shares for nearly 17% annual long-term growth, it may be time to start buying Royal Caribbean stock again.
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Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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