Crude oil futures traded sharply higher on Tuesday morning after US President Donald Trump reinstated a naval blockade of Iranian ports, according to a report from The Hindu Business Line. At 10.05 am on Tuesday, September Brent oil futures on ICE were at $84.78, up by 1.78%, and August crude oil futures on WTI (NYMEX) were at $79.70, up by 2%. On the Multi Commodity Exchange (MCX), July crude oil futures traded at ₹7,658, up 4.05% from the previous close of ₹7,360, while August futures were at ₹7,653, up 3.50% from ₹7,394.
Blockade and Fee Details
In a post on Truth Social, Trump said: “The Hormuz Strait is OPEN, and will remain OPEN, with or without Iran. We are reinstating the THE IRANIAN BLOCKADE, so named because it is only stopping Iran’s ships or customers from entering or leaving. All other countries will have fair and open use of the Strait. The U.S.A. will be, from this point forward, known as 'THE GUARDIAN OF THE HORMUZ STRAIT,' but as such, and as a matter of FAIRNESS, will be reimbursed, at the rate of 20% on all cargo shipped, for any and all costs necessary to do the job of providing safety and security to this very volatile section of the World. The process and formation will begin immediately.”
A statement by US Central Command said its forces will resume blockading maritime traffic entering and exiting Iranian ports on July 14 at 4 pm ET. The forces will enforce the blockade against vessels transiting to or from Iranian ports and coastal areas, while continuing to support traffic flow for all vessels not violating the blockade.
Analyst Perspective
In their Commodities Feed for Tuesday, Warren Patterson, Head of Commodities Strategy of ING Think, and Ewa Manthey, Commodities Strategist, assessed the impact. They said the return of the US blockade is much more impactful for markets than the previous suspension of the sanction waiver on Iranian oil. The Memorandum of Understanding is starting to look well and truly dead. The consensus says neither side wants an escalation -- yet their recent moves tell a different story. Clearly, oil prices simply aren’t high enough yet to compel Washington to push harder for de‑escalation, they said.
The analysts also highlighted the uncertainty around navigation costs. A 20% fee on a Very Large Crude Carrier (VLCC) carrying 2 million barrels at $80 a barrel would equate to about $32 million or an additional cost of $16 per barrel. This is significantly higher than the $1 per barrel toll for which Iran has been pushing.
Military Strikes and Deployment
Another statement from US Central Command said it completed the latest wave of strikes against Iran at 10:15 pm ET on July 13. During the five-hour mission, US forces successfully struck military targets across Iran, including Bushehr, Chah Bahar, Jask, Konarak, Abu Musa, and Bandar Abbas to further degrade Iran’s ability to attack commercial shipping. The forces employed precision munitions against Iranian coastal defence systems, missile and drone sites, and maritime capabilities. It added that more than 50,000 US service members are currently deployed across West Asia.
Price Comparison Table
| Contract | Previous Close | Current Price | Change |
|---|---|---|---|
| September Brent (ICE) | $83.30 (approx) | $84.78 | +1.78% |
| August WTI (NYMEX) | $78.14 (approx) | $79.70 | +2.00% |
| July MCX Crude (₹/bbl) | ₹7,360 | ₹7,658 | +4.05% |
| August MCX Crude (₹/bbl) | ₹7,394 | ₹7,653 | +3.50% |
For commodity traders and procurement teams, the reinstatement of the blockade — combined with the proposed 20% transit fee and ongoing military strikes — signals a sustained period of elevated geopolitical risk and substantially higher shipping costs for crude passing through the Strait of Hormuz. The price differential between Brent and WTI may widen further as supply from the Middle East faces new barriers, and the $16/barrel potential fee addition could become a key input in cost models for raw material procurement.
Other commodities also showed gains: August nickel futures on MCX rose 1.12% to ₹1,607, while on the National Commodities and Derivatives Exchange (NCDEX), August turmeric (farmer polished) increased 2.64% to ₹20,564 and July guargum futures edged up 0.57% to ₹12,200.
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