Oil markets swung sharply on Thursday after a cargo ship reported being hit by a projectile near Oman, prompting the United Nations to suspend an emergency escort programme through the Strait of Hormuz — the narrow waterway that, before the conflict, carried roughly one-fifth of the world's daily oil and liquefied natural gas supplies.

The incident reversed what had briefly been a moment of cautious optimism. Earlier in the day, oil prices had fallen to their lowest point since before the war, with Brent crude futures for August delivery down around 1.4% to approximately $72.70 a barrel and US West Texas Intermediate slipping below $70. Prices had fallen for four consecutive sessions, erasing all gains recorded since the outbreak of hostilities. Then the attack report arrived, and benchmark prices rose 2%.

A fragile chokepoint

The UN's International Maritime Organization (IMO) had been shepherding stranded ships and seafarers out of the strait under an evacuation plan launched on 23 June. According to IMO data, 57 ships carrying around 1,100 seafarers had already transited successfully before the programme was paused. The ship reportedly struck — identified by four sources as the Singapore-flagged Ever Lovely — was hit close to Oman, British navy agency UKMTO confirmed. A security source said it was likely targeted by a drone, and two US officials told Reuters that Iran had fired on the vessel.

The attack came hours after Iran's Revolutionary Guards warned all vessels to use only routes through the strait that Tehran had designated, explicitly rejecting UN-coordinated alternatives. Iran's newly established Persian Gulf Strait Authority stated that vessels travelling outside approved routes would not be guaranteed safe passage and that any consequences would rest with ship owners and commanders.

“"Consequences arising from passage through unauthorized routes shall be the responsibility of the owner, operator, and vessel commander." — Iran's Persian Gulf Strait Authority”

Rubio in Bahrain: no tolls, no exceptions

US Secretary of State Marco Rubio was wrapping up a Gulf tour aimed at reassuring regional allies about Washington's preliminary accord with Tehran when the attack was reported. Speaking in Bahrain — home to the US Navy's Fifth Fleet — he had told Gulf Arab foreign ministers that Iran would not be permitted to impose fees on vessels transiting the Strait of Hormuz. Under the preliminary agreement, Iran must allow free passage for 60 days, but Tehran has already signalled it may seek to impose tolls once that window closes, possibly framed as environmental, navigation, or security charges.

“"No country on Earth has the right to charge for the use of international waterways. And that will never be an acceptable condition of any deal," Rubio told ministers.”

Gulf states are watching proceedings with deep unease. The preliminary deal has drawn scepticism across the region, where many governments came under Iranian attack during the conflict and view its terms — which reportedly include a $300 billion reconstruction fund for Iran and the easing of some sanctions — as excessively generous to Tehran. Washington's Gulf allies have also expressed concern that the reconstruction fund could be used to rebuild Iran's military capacity.

A 60-day clock, and many open questions

The framework agreement establishes a 60-day negotiating window to address the thorniest outstanding issues: Iran's nuclear programme, the scope of sanctions relief, permanent arrangements for the Strait of Hormuz, and a parallel conflict in Lebanon, where Israel has been fighting Hezbollah since the militant group attacked on 2 March in solidarity with Iran. Conflicting accounts have already emerged over key elements of the deal — Iran's chief negotiator, Mohammad Bagher Ghalibaf, denied US claims that Tehran had agreed to spend unfrozen assets on American agricultural products.

For global energy markets, Thursday's events underscored how thin the margin for error remains. Shipping analytics firm Windward had reported a 48% jump in confirmed strait transits on Wednesday, and maritime data firm Lloyd's List Intelligence noted that 125 vessels crossed the strait last week, up from just 33 the week prior. Yet analysts at ING cautioned that the oil sell-off may have moved faster than fundamentals warranted, noting that vessel traffic, while improving, remained below pre-war norms. The attack near Oman is a sharp reminder that the strait's reopening is a process, not a fait accompli.

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