Iran Closes Hormuz Again and Oil Jumps as Ceasefire Nears Expiry

Iran reversed its reopening of the Strait of Hormuz on Saturday, a day after declaring the waterway “completely open,” the Associated Press and NBC News reported. The AP added that Iran fired on ships trying to pass. Oil prices jumped in early trading Sunday.

Iranian military officials said control of the strait had “returned to its previous state” under “strict management and control of the armed forces,” according to NBC News, and the Revolutionary Guard navy said the strait is closed until the U.S. blockade of Iranian ports is lifted, warning that no vessel should move from its anchorage, the AP reported. Iran’s military called the blockade “acts of piracy and maritime theft,” NBC News said. Guard gunboats fired on a tanker and an unidentified projectile hit a container ship, damaging some containers, according to the British military’s maritime trade monitor, as cited by the AP. India’s foreign ministry said, the AP reported, that it summoned Iran’s ambassador over the firing on two India-flagged merchant ships.

The reversal followed President Trump’s statement that the blockade “will remain in full force” until Iran reaches a deal. U.S. Central Command said its forces had sent 23 ships back to Iran since the blockade began Monday, the AP reported. Mr. Trump said Saturday that Iran “got a little cute” but that “very good” conversations were under way, adding, “They can’t blackmail us.” The AP also reported he said the U.S. had seized an Iranian-flagged cargo ship that tried to get around the blockade, and that Iran has promised to respond.

Diplomacy remains stuck. Pakistan’s foreign minister said his country was working to bridge differences and expects to host a second round of negotiations early next week, the AP reported. Iranian Deputy Foreign Minister Saeed Khatibzadeh told the AP that Iran is not ready for a new round of face-to-face talks because the Americans “have not abandoned their maximalist position,” and called the idea of handing over Iran’s roughly 970 pounds (440 kilograms) of enriched uranium to the U.S. “a nonstarter.” He warned that Washington is “risking the whole ceasefire package.” A two-week ceasefire between the U.S. and Iran is set to expire Wednesday, according to the AP.

Markets reacted when trading resumed on Sunday. U.S. crude rose 6.4 percent to $87.88 a barrel and Brent climbed 6.5 percent to $96.25, the AP reported, after plunging more than 9 percent on Friday’s reopening news. The AP put Friday’s closes at $82.59 for U.S. crude and $90.38 for Brent; NBC News gave $83.85 for U.S. crude. Crude traded near $70 before the war began on Feb. 28.

Asked on CNN’s “State of the Union” when U.S. drivers might again see gasoline below $3 a gallon, Energy Secretary Chris Wright said pump prices might not fall that low until next year, but “prices have likely peaked, and they’ll start going down,” the AP reported. Analysts quoted by the AP warned that the longer the strait stays closed, the worse prices could get, and that even a deal could leave months of backed-up tanker traffic to clear.