Iran’s armed forces stopped two tankers from transiting the Strait of Hormuz on Sunday. The odds of US Navy escorts through Hormuz by April 30 are at 17.5% YES, up from 18% 24 hours ago.
The US escorts through Hormuz market jumped 3.5 points in the last 24 hours, with the April 30 deadline just 12 days away. Face value is $42,074 per day, but actual USDC traded is $8,310, indicating moderate liquidity. It takes just $260 to move the price 5 points, so the market is prone to sharp swings on thin volume.
In the warships through the Strait of Hormuz market, odds for UK warships transiting by April 30 are at 8.5% YES, down from 12% a day ago. The US escort market moved up while the UK warship market moved down, suggesting traders see a unilateral US response as more likely than a coordinated allied one.
At 21.5¢, a YES share pays $1 if the US Navy escorts a tanker by April 30, a 4.65x return. The bet requires believing the Pentagon will authorize escort missions within 12 days of Iran’s tanker seizures.
Watch for announcements from the Pentagon or CENTCOM. Any order to increase US naval presence or begin escort missions would move these markets fast.
