Iranian Crude Exports Resume After Six-Week US Navy Blockade

The US Navy's blockade on Iran has been lifted after six weeks, allowing crude oil loadings to resume at Kharg Island. The terminal, which handles around 90% of the country's crude exports, was crippled by the blockade.

Iran's oil loadings collapsed from an average of 2.1 million barrels per day to just 567 thousand barrels per day during the blockade - a roughly 73% drop.

Following an interim peace agreement that restored commercial shipping access through the Strait of Hormuz, at least three Very Large Crude Carriers were confirmed loading at Kharg Island on June 20. Initial tanker departures carrying millions of barrels have been spotted shortly after the blockade was lifted, with most of the crude destined for Chinese markets.

The resumption of Iranian crude exports creates a supply squeeze, as taking 1.5 million barrels per day off the market and then putting them back on will put pressure on multiple fronts. If Iran follows through on using digital assets for Hormuz transit fees, it would represent one of the most consequential real-world use cases for cryptocurrency to date.