Iran's Islamic Revolutionary Guard Corps ( IRGC ) announced the re-closure of the Strait of Hormuz, the world's most critical oil chokepoint, after a brief U.S. announcement of full openness. The move has immediately depressed Brent and WTI prices, underscoring the strait's pivotal role in global oil supply. Context The decision follows a series of back-and-forth actions since the February 28 U.S. and Israel strikes that triggered the war. A U.S. naval blockade imposed on April 13 has kept Iranian ports closed, while Iran has repeatedly reopened and closed the strait in response to diplomatic developments. Key Data The IRGC declared that control of the strait has "returned to its previous state," and that it is now under "strict management and control of the armed forces," accusing Washington of "piracy." The brief opening had already been priced into markets, with Brent crude falling roughly 9.5% to $89.89 a barrel and WTI sliding more than 10% to $84.89 after the announcement. The strait handles about 20% of global oil supply, roughly 20 million barrels per day, and the IEA warns that Middle East output recovery could take up to two years. White House deputy press secretary Anna Kelly said the U.S. had declared the strait fully open, a claim that the IRGC immediately contradicted with the statement that "The Strait of Hormuz is completely open for business, and Iran has agreed to never close the Strait again." Outlook With the strait closed and the blockade in place, market participants expect volatility to persist until a diplomatic resolution is reached. However, the limited traffic that does pass through the channel is likely to keep the supply chain largely intact, mitigating the risk of a sharp supply shock.