Trump has made one of the world’s most important markets a mystery

July 1, 2026 — 9:56am

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One of the more confounding aspects of the war in the Middle East is the rate at which the oil market has changed since the US and Iran agreed their 60-day ceasefire.

Oil prices are almost back to their pre-war levels, with Brent crude trading around $US73 a barrel, and the volume of ships passing through the choke point of the Strait of Hormuz has almost normalised. The greatest oil shock in history seems to have passed with only fleeting effects.

Below the seeming calm of oil prices that have retreated from their highs approaching $US120 a barrel and the return of traffic to the strait, however, are a lot of moving parts that make it difficult to predict whether the current appearance of normalcy can be sustained.

For a start, the partial cessation of hostilities – Iran fired on two vessels last week – isn’t a permanent end to the conflict, which could flare up at any moment even though it is obvious that Donald Trump, having failed to achieve any of the objectives targeted at the start of the war, has no appetite for a resumption of the conflict.

There’s the existence of the mines Iran laid in the strait that will have to be cleared which, given that Iran itself seems to have only the fuzziest idea of where they are, could take months.

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Iran also remains adamant that it will maintain control of the strait – never previously closed – and may impose charges on vessels transiting it in future.

There’s also going to be a permanent risk premium associated with transiting the strait – a premium that isn’t reflected in current oil prices – now that Iran has demonstrated its ability to close it.

That will deter Middle Eastern producers from relying on the strait. New pipelines that bypass the strait will take time to........

© WA Today