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Trump drops Hormuz toll but keeps Iranian shipping blockade in place
The toll reversal relieves one source of freight risk but the continuing blockade leaves Hormuz transit ambiguous for energy markets.
Donald Trump said on Tuesday (2026-07-14) the United States would not impose a 20% transit fee on cargo moving through the Strait of Hormuz, stepping back from a proposal that had alarmed shipping markets, but confirmed that a blockade on Iranian vessels would continue, Montel News reported. A trader who spoke to Montel described the combined position as "highly ambiguous."6
ICE Brent crude front-month was trading at $84.50 a barrel as of Thursday morning (2026-07-16), down 0.14% on the session, well below the highs reached during the acute phase of the conflict. At peak stress in mid-May 2026, the May futures contract for Brent climbed to $112.60 a barrel, according to Investing.com, and the Economist noted the contract for July delivery reached $110 a barrel on Monday (2026-05-18) as a 10-week US-Iran stalemate ground on.4,3
The toll plan's withdrawal removes one layer of cost uncertainty for tanker operators and LNG shipowners, but the sustained blockade on Iranian shipping preserves a risk premium in crude markets. How broadly that blockade is enforced determines whether the relief holds.6
The backdrop runs deeper than Tuesday's (2026-07-14) statement. The US and Iran struck a two-week ceasefire in late May 2026, with Iran pledging "safe passage" through the strait, according to Montel. Trump's own statement at the time committed to suspending US bombing of Iran for the ceasefire duration. Foreign Policy analysis from June (2026-06-15) warned that extracting genuine Iranian concessions after the truce would be the harder problem, and the latest announcement suggests that underlying dispute remains unresolved.1,5
LNG markets have tracked the Hormuz situation closely throughout. Analysts told Montel during the ceasefire period that LNG carriers were still avoiding the strait, citing the fragility of the truce and the difficulty of obtaining insurance for vessels transiting the area. JKM Asian LNG was pricing at $19.93/MMBtu as of Thursday (2026-07-16), reflecting the cumulative freight and risk adjustments the market has absorbed since the conflict began.2
A sustained Hormuz restriction acts as a tax on Gulf crude exports. Dubai crude was at $74.64 a barrel as of Thursday (2026-07-16), and the directional pressure from the blockade runs toward tighter effective supply from the Gulf for as long as the restriction holds.6
Trump's framing on Tuesday (2026-07-14) did not resolve the core ambiguity: a blockade on Iranian vessels is not the same as safe passage for all commercial traffic, and markets have struggled since May 2026 to price the difference. The toll reversal may reduce political friction with European and Asian trading partners who had protested a per-cargo levy, but the commercial and insurance position for non-Iranian vessels transiting the strait remains unclear.6,2
US petrol prices hit $4.46 a gallon on average in mid-May 2026, an 8% jump in a single week, according to the Economist — a domestic political cost that likely shaped Trump's decision to step back from the toll. ICE Brent crude front-month has since retreated to $84.50 a barrel as of Thursday (2026-07-16), well below the $110-plus crisis peak, and the immediate price pressure on Washington has eased considerably.3
Any clarification from the US Navy or State Department on exactly which vessels the blockade covers would give markets a cleaner framework. Without it, they are working from a statement that simultaneously removes a fee and maintains a restriction, and the trader quoted by Montel on Tuesday (2026-07-14) was not alone in reading it as anything but clear.6