US lifts blockade on Strait of Hormuz, 12.5 million barrels of oil flow on first night of ceasefire

The deal signed in Versailles

President Donald Trump and Iranian President Masud Pezeshkian signed a memorandum of agreement late Wednesday, 17 June, in Versailles, France. The document calls for the immediate opening of the Strait of Hormuz, the lifting of the US blockade on Iranian ports, and the start of 60-day negotiations on Iran's nuclear programme. Iranian foreign ministry spokesman Esmail Baghaei later said the memorandum had been "officially finalised" with digital signatures from both sides and that a planned ceremony in Switzerland on Friday would not take place. The White House did not comment on the ceremony's cancellation.

First ships through the Strait

Within hours of the signing, the Qatari-chartered LNG carrier Mraikh and the empty Chinese tanker Ye Chi entered the Strait of Hormuz on Thursday morning. US Vice President J.D. Vance told a White House briefing that 12.5 million barrels of crude had transited the strait overnight, the highest volume since the conflict began.

Iranians have not fired on ships in the Strait of Hormuz for the second night in a row. They are keeping their commitments. CENTCOM let more than a dozen ships through our blockade, so we are keeping our part as well.

The US military confirmed that the blockade had been lifted, but added that warships would remain in the region to enforce all terms of the agreement.

Oil prices fall from crisis peaks

Brent crude futures dropped another 2 percent to trade below $78 a barrel, the lowest since the war started on 28 February. US benchmark WTI hovered around $75, close to the pre-war level of $70. Energy analyst Dawid Czopek noted that spot transactions had reached $100 and sometimes $150 a barrel during the blockade.

The market is slowly returning to normal; there is hope that things will be fine.

Diesel prices, which had climbed disproportionately because many Persian Gulf refineries were cut off, are also easing. He added that China, the world's largest oil importer, had weathered the blockade as a strategic stress test, though the consequences of a longer disruption remain unknown.

Israel kept out of talks but expected to comply

Israel, which invaded Lebanon in March and has since occupied much of the country's south, was excluded from the US-Iran negotiations. The memorandum explicitly calls for a "lasting end" to the war in Lebanon and respect for its territorial integrity and sovereignty. Vance said Washington expects Hezbollah not to launch drones and missiles at Israelis, and Israel not to "go crazy in Lebanon".

Both sides must respect their part.

Prime Minister Benjamin Netanyahu has not yet publicly reacted to the pact.

Shipping restart to be gradual

Industry experts caution that clearing the backlog of vessels will take weeks. Adam Sharpe, vice president of editorial at Lloyd's List Intelligence, told CNBC that the most likely scenario is a phased resumption rather than an immediate return to over 100 daily transits. Pre-war vessel traffic ranged from 650 to 770 per week. Unresolved questions include prior permission requirements, possible Iranian service fees, rules for foreign naval escorts, and certification that mines or other residual threats have been cleared. Saudi Aramco's CEO, Yasir Al-Rumayyan, said the company is considering expanding its global storage capacity, particularly in Asia, to better shield markets from future disruptions.