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Strait of Hormuz Risks Deepen as Tanker Traffic Stops, Oil Volatility May Persist, Rystad Energy Says

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US-Iran tensions sent Brent near $79 per barrel as risks in the Strait of Hormuz and stalled tanker traffic heightened fears of prolonged oil market disruption, Rystad Energy said in a note on Wednesday.

"Tanker traffic through the Strait of Hormuz has essentially stopped, which tells you more about risk perception right now than any statement from Washington or Tehran," Rystad's Head of Geopolitical Analysis, Jorge Leon, said.

He added that Brent climbed to its highest level since June 19 as markets rapidly priced in renewed conflict.

Reported attacks on commercial vessels in the Strait of Hormuz triggered fresh US retaliatory strikes overnight, while President Donald Trump declared the ceasefire over, raising fresh doubts about the conflict's trajectory, Rystad said.

As security concerns intensified, shipping activity through the Strait of Hormuz slowed sharply, with vessel movements dropping from about 20 on July 6 to 11 on July 7, while traffic appeared to stop entirely on Wednesday, Rystad said.

"The real test comes after 9 July, once the mourning period ends and both sides show whether there is still an appetite for a diplomatic off-ramp," Leon added.

The latest military exchanges have cast further doubt on whether the 60-day ceasefire can still lead to a lasting peace agreement, while increasingly fragile conditions threaten further diplomatic talks, Rystad said.

Oil price swings will likely remain elevated in the near term as markets weigh higher insurance costs, vessel safety concerns, shipping delays and the potential for additional retaliation, even if physical supply disruptions remain limited, Rystad said.

If both sides adopt a tougher stance after July 9, geopolitical risk premiums could climb further, Rystad said.

Peak summer demand for road and aviation fuels could further magnify the market's response to any supply disruption.

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