Shipping traffic through the Strait of Hormuz slowed further over the weekend, following tanker attacks and a lack of progress in US-Iran peace talks. Daily transits stood at nine vessels, down from an August average of 12 ships and far below the 130-plus ships that crossed daily before the US-Israel war on Iran began in February.

The United Kingdom Maritime Trade Operations Center (UKMTO) reported an incident on Tuesday when a vessel was struck by an unknown projectile in the waterway. The impact caused damage to the starboard side and resulted in a crew casualty, though there were no reports of environmental damage. Abu Dhabi National Oil Company previously reported that two of its vessels were attacked on Thursday, with the UAE government blaming Iran.

Diplomatic Stalemate

Negotiations to build upon a June agreement to end the conflict have stalled. President Donald Trump rejected an extension to the 60-day ceasefire following the Memorandum of Understanding signed by Washington and Tehran. Iranian Foreign Minister Seyed Abbas Araghchi blamed Israeli Prime Minister Benjamin Netanyahu for derailing the negotiations.

Iran’s Secretary of the Supreme National Security Council, Mohsen Rezaee, pushed back against Trump’s claim that the Strait of Hormuz was U.S. territory. In a post on X, Rezaee stated that "the gap between America’s inability to reopen the Strait of Hormuz and its claim to own it" was "greater than the 7,000-mile distance" between Washington DC and the waterway. He touted a "post-American order in the Persian Gulf."

Rezaee had earlier outlined conditions for reopening the strait, stating it would reopen only if the US ends the war and blockade, releases frozen assets, and agrees to a region-wide ceasefire. Rep. Don Bacon (R-NE) acknowledged that Trump could have handled the Iran war communication better, citing the impact on affordability in the US.

Market Impact

High energy costs continued to affect consumers. The national average price of gas surged to $4.0654/gallon, according to the American Automobile Association. Prices remained above $5/gallon on average in states like California, Washington and Hawaii.

On the oil front, prices surged amid escalating tensions. West Texas Intermediate crude stood at $85.58/bbl, while Brent crude surged past $90 to $91.63/bbl. US Energy Secretary Chris Wright stated that the Iran war was not the only factor driving high prices, blaming clean-energy policies implemented under former President Joe Biden.

What the Numbers Show

The contraction in commercial throughput relative to historical baselines is severe. The table below illustrates the scale of the decline in daily vessel transits through the strait.

With daily traffic at nine vessels compared to a pre-conflict baseline of over 130, current flow represents less than 7% of normal capacity. This divergence highlights the operational impact of the blockade and security risks on global supply chains dependent on the strait.

US President Trump declared that he would soon designate the Strait of Hormuz as a territory of the United States, in remarks directed at Iran. The statement marks a significant escalation in the tone of US rhetoric concerning one of the world's most strategically important waterways.

Context of the statement

The Strait of Hormuz is a narrow maritime passage connecting the Persian Gulf to the Gulf of Oman. Trump's remarks, as reported, were framed as a direct message to Iran, with the president stating: "Pretty soon I'll be declaring Hormuz Strait a territory of the US."

Key details

No additional context, conditions, or timelines were provided in the source material beyond the statement itself.