Brent Jumps 10% as Hormuz Mine Claims Emerge
Iran's disputed claim that two tankers hit mines in the Strait of Hormuz has pushed Brent crude above $84 a barrel, underscoring the persistent risk premium on a chokepoint effectively closed since late February.
Iran’s Islamic Revolutionary Guard Corps claimed two tankers struck mines south of the Strait of Hormuz, a disputed assertion that has helped drive Brent crude above $84 a barrel, putting the benchmark on track for a weekly gain exceeding 10%.
The IRGC alleged the vessels caught fire after being lured into a minefield by American intelligence agencies. US Central Command flatly rejected the account, stating the claim was false and in keeping with a pattern of fabricated IRGC announcements. The Iranian military did not identify the vessels, their flags, or report any casualties, but warned other ships to avoid the corridor.
The conflicting statements arrive amid a broader battle for control of the chokepoint and a relentless campaign targeting commercial shipping. The IRGC separately claimed its forces used a combined missile and drone operation to halt four ships attempting to transit the waterway. Furthermore, overnight on July 17, the UK Maritime Trade Operations agency reported a tanker was struck by a projectile off the coast of Oman.
The Strait of Hormuz has been effectively shut to standard maritime traffic since the conflict erupted on February 28. That was when US and Israeli strikes prompted Tehran to begin systematically targeting vessels in the critical waterway. Prior to the war, roughly a fifth of the world's oil passed through the strait.
Iran has attempted to assert control over the remaining navigation options. Tehran has instructed tankers and cargo ships to use only the channels close to its coastline in the north, steering them away from the southern routes near Oman where it claims mines have been laid. The IRGC declared the strait completely closed, stating no oil, gas, or chemical fertiliser would leave the region until American attacks cease.
The military confrontation continues to intensify on the water and on land. The US has reimposed a naval blockade on Iranian ports and has conducted strikes against coastal missile, drone, and naval targets for seven consecutive nights. This escalation has effectively destroyed a June 17 interim deal, under which Tehran had agreed to suspend a planned transit toll for 60 days. Both sides have now abandoned that arrangement.
For energy markets, the immediate supply shock has largely been priced in. However, the breakdown of diplomatic stopgaps and the introduction of unverified mine claims ensure a persistent risk premium. As long as the US blockade and Iranian retaliatory strikes continue, the physical closure of the strait will keep a firm floor under global crude prices.
