Overview
- A 60‑day U.S.–Iran memorandum has ended, removing a brief diplomatic hedge that had offered a small chance of safer, more reliable shipping through the Strait of Hormuz.
- Kpler data show flows through the strait plunged from roughly 18 million barrels per day before the war to about 4.8 million bpd in July and roughly 2 million bpd in August, reflecting a near collapse of commercial oil and product transit.
- Commercial shipping is largely stalled because of security incidents near Qeshm Island and off Oman, plus insurers and ports restricting coverage and access for many vessels.
- The cut in maritime traffic is already hitting the Global South through higher fuel and transport costs, tighter fertilizer supplies for farmers, rising food prices for import‑dependent families, and lost income for workers in tourism and trade.
- Diplomatic proposals such as an Iran‑Oman corridor remain unresolved and face legal, insurer and U.S. objections, leaving market stability and the pace of recovery in transit uncertain and raising the risk of broader development and humanitarian fallout.