Global Markets Pivot as US Naval Blockade Persists Despite Reopening of Strait of Hormuz

Oil prices drop 10% as Iran reopens the Strait of Hormuz, but President Trump vows the US naval blockade remains. Julius Baer analysts advise investor caution.

By: AXL Media

Published: Apr 17, 2026, 10:36 AM EDT

Source: Information for this report was sourced from Julius Baer

The Breaking Development

The geopolitical landscape shifted dramatically on Friday, April 17, 2026, as conflicting signals from Washington and Tehran sent shockwaves through global energy and equity markets. Iranian Foreign Minister Abbas Araghchi announced that the Strait of Hormuz is now fully open for commercial transit, a development intended to de-escalate the 2026 Strait of Hormuz crisis. However, President Donald Trump swiftly countered on social media, stating that while the passage is open, the US naval blockade—initiated on April 13—will remain active until a "100% complete" transaction with Iran is reached. This "dual-track" reality has left investors caught between the relief of a potential energy supply restoration and the friction of a continuing blockade.

Background and Context

The conflict, which intensified on February 28, 2026, has seen oil prices reach a peak of $126 per barrel in March, marking the largest monthly increase in history. The crisis was fueled by the failure of the Islamabad peace talks, leading the US to enforce a blockade to curtail Iranian oil exports, which cost Tehran an estimated $435 million per day. For the past month, the Strait of Hormuz has been "functionally impaired," with maritime insurance premiums skyrocketing and traffic at one point falling by 70%. The recent 10-day ceasefire between Israel and Lebanon, separate from the broader Iran conflict, provided the diplomatic opening for today’s attempt to reopen the vital shipping corridor.

Key Players and Stakeholders

According to Christian Gattiker, Head of Research at Julius Baer, the current environment favors nimble traders over traditional investors. While the "Islamabad surprise"—a long-hoped-for peace deal—remains elusive, the successful defense of regional energy infrastructure has prevented a total global supply collapse. Strategists Norbert Rücker and Christian Gattiker note that although oil production and exports have been curtailed, broad damage to energy facilities has not materialized. This resilience is a key factor behind the recent market rebound, which saw several indices approach record highs earlier this week before the latest blockade-related volatility took hold.