Oil prices surged and US stock futures dropped overnight after President Trump announced a naval blockade of the Strait of Hormuz late on Saturday.
Why it matters: The strait is the world’s most important oil chokepoint. With crude already up more than 30% since the Iran conflict began in late February, the blockade threatens to push energy costs higher for consumers worldwide and adds pressure to an already fragile global economy.
Oil prices
Brent crude, the international benchmark, jumped 7.4% to $102.20 a barrel for June delivery. US crude soared 8% past $104. Both benchmarks returned to triple digits for the first time since the two-week ceasefire briefly calmed markets on 7 April.
Goldman Sachs warned that another month of Hormuz disruption could keep Brent above $100 for the remainder of 2026.
Stock futures
Dow Jones Industrial Average futures initially dropped 517 points, or 1.1%. S&P 500 futures lost 1.1% and Nasdaq 100 futures shed 1.2%. By early Monday morning, losses had been pared to roughly 0.5% across all three indices.
Asian markets also traded lower on Monday as the blockade announcement rippled through global exchanges.
The broader picture
Shipping through the Strait of Hormuz has been largely disrupted since late February, when the US and Israel launched air strikes against Iran. Iran had imposed tolls on vessels transiting the strait. Trump’s blockade order specifically targets ships that have paid those tolls, declaring that “no one who pays an illegal toll will have safe passage on the high seas.”
The ceasefire brokered on 7 April had sent oil prices down 8% and steadied equity markets. That relief now appears short-lived.