EU and Gulf Cooperation Council (GCC) officials expect a US–Iran deal could take close to 6 months, following disputes over uranium enrichment and nuclear capability. After this timeline was discussed, crude oil futures rose by more than $3 in a day to around $98/bbl.
The Strait of Hormuz has been closed during a 10-day ceasefire, and each day of closure adds pressure on GCC economies. EU and GCC officials are watching how long the ceasefire lasts.
Europe is preparing a plan intended to help reopen the Strait of Hormuz after hostilities end. The proposal would exclude “belligerent parties”, defined by the Wall Street Journal as the US, Israel and Iran.
Current shipping problems continue while the Strait remains closed. Bloomberg reports that disputes between charterers and shipowners mean barely any deals are being reached to load oil inside the Persian Gulf, and vessel-hire costs include a risk premium of about $475,000 a day.
The article states it was made with help from an Artificial Intelligence tool and reviewed by an editor.
We should remember how quickly crude oil futures reacted during the tensions in 2025. News that a US-Iran deal could take six months was enough to push prices up over $3 to $98 a barrel, showing the market’s extreme sensitivity to diplomatic timelines. This historical price action serves as a clear warning for the weeks ahead.
The strategic importance of the Strait of Hormuz cannot be overstated, as it remains a critical chokepoint. The U.S. Energy Information Administration (EIA) confirms that even now in 2026, around 21 million barrels of oil, or about 21% of global petroleum liquids consumption, pass through the strait daily. Any disruption, even a threat of one, has an immediate and significant impact on global supply.
Given the recent reports of stalled diplomatic talks and renewed friction over uranium enrichment, the situation feels similar to the lead-up to the 2025 standoff. We are seeing market complacency, with the CBOE Crude Oil Volatility Index (OVX) trading near historic lows, suggesting potential disruptions are not being priced in. This makes protective derivative positions relatively inexpensive right now.
The extreme shipping costs we saw in 2025, with risk premiums hitting $475,000 a day, highlight the real-world financial shock of a closure. For traders, this implies that buying long-dated call options on WTI or Brent crude futures is a prudent strategy. This offers exposure to a potential price surge while capping downside risk to the premium paid.
Purchasing these calls acts as a cost-effective insurance policy against a sudden geopolitical flare-up. If tensions escalate and the strait is threatened again, the value of these options could increase substantially. This provides a defined-risk way to position for a repeat of the volatility we witnessed last year.
