Iran Closes Hormuz Again as Lebanon Tensions Strain US-Iran Deal

EcoPulse24 | Dubai

Iran's Joint Military Command declared the Strait of Hormuz closed on Saturday, June 20, citing ongoing Israeli military operations in Lebanon and what Tehran described as a clear violation of US commitments under the recently signed memorandum of understanding. The announcement came hours after Iranian negotiators were dispatched to Switzerland for talks, even as Tehran's foreign ministry questioned whether any meaningful progress was possible.

IRGC Issues Warning to All Vessels

The Islamic Revolutionary Guard Corps issued warnings to all vessels to avoid approaching the Strait of Hormuz, stating their safety would be at risk. A radio message broadcast to ships in the waterway stated that Hormuz would remain closed until Israel withdrew from Lebanon and the US fully lifted the naval blockade. The IRGC added in its official statement broadcast on state television that further steps had been planned should Israeli operations continue. These developments followed warning shots fired by Iran at vessels in the Strait on Friday, according to two people familiar with the incident.

Negotiators Fly to Switzerland

In a development running in parallel with the closure announcement, Iranian state television reported that Tehran's negotiating team would travel to Switzerland within minutes to hold discussions with US counterparts on the temporary agreement. The trip, originally scheduled for Friday, had been postponed amid the latest tensions. However, Foreign Ministry spokesperson Esmaeil Baghaei tempered expectations, saying the visit was aimed at demanding the other party fulfil its obligations. Baghaei indicated that full negotiations toward a final deal would not begin until core commitments were implemented, warning that the entire MoU would be at risk otherwise.

Lebanon Developments Strain the Framework

The immediate context for the renewed closure announcement was the continuation of Israeli military operations in southern Lebanon. Reports indicated that Israeli strikes killed at least 16 people, including two children, in the hours following ceasefire reports. Lebanon's Health Ministry announced that the total death toll from the most recent conflict between Israel and Hezbollah surpassed 4,000. Hezbollah stated it remained committed to the ceasefire but accused Israel of repeated violations, pledging its fighters would continue to respond to attacks.

The 60-Day MoU and Economic Stakes

The United States and Iran signed a temporary memorandum of understanding earlier in the week under which shipping was permitted to resume through the Strait of Hormuz, which carries approximately one-fifth of the world's traded oil and liquefied natural gas. Under the agreement, vessels could transit without fees for 60 days, with the period extendable pending progress on a broader nuclear deal. Ships had begun passing through the waterway following the signing, with reports of nearly 10 million barrels of crude observed transiting or positioned near the Strait on Thursday, including the first Saudi-owned tankers to move since the conflict began more than three months ago. The economic incentives offered to Iran under a potential permanent agreement include sanctions relief and the establishment of a $300 billion reconstruction fund.

Insurance Requirements and Shipping Uncertainty

Adding to uncertainty in global shipping markets, Iran's Hormuz Strait Authority circulated a document requiring all transiting vessels to carry a valid insurance policy approved by the Authority, according to the Financial Times. The coverage is currently offered free of charge, but the Authority stated it reserves the right to impose insurance fees in the future. Iran had previously announced intentions to impose transit fees of $2 million per vessel, payable in cryptocurrency. The International Maritime Organization said it was still working to establish a humanitarian corridor for seafarers stranded in the Gulf, some for more than 100 days. Oman confirmed it would not impose transit fees, though it was reported to be studying legal fees for services including environmental protection and maritime navigation management.

EcoPulse24 Analysis

EcoPulse24 Analysis: The renewed closure declaration underscores how tightly the US-Iran diplomatic track is intertwined with Lebanon-related developments. The ability to separate the Lebanese front from the nuclear file remains the central challenge for US negotiators in the coming weeks. With Switzerland talks proceeding under a cloud of skepticism from Tehran, energy markets face renewed uncertainty. Brent crude was tracking a weekly loss of approximately 8% as of Friday; a sustained Hormuz disruption or a breakdown in the Switzerland talks would likely alter that trajectory. The outcome of the next diplomatic round will be a key variable for both oil markets and the broader security landscape across the Gulf region.