Iran shuts Strait of Hormuz, fires on commercial vessels

Iran has shut the Strait of Hormuz and fired on commercial vessels. The market for Strait of Hormuz traffic returning to normal by May 31 sits at 0.4% YES.

The closure sharply reduces the likelihood of normal shipping levels resuming soon. The market for fewer than 10 ships transiting the Strait by April 19 prices YES at 0.4%, with active hostilities making near-term normalization almost impossible to price in.

Volume in the Strait of Hormuz traffic market is thin: $14 in USDC traded in the last 24 hours. It takes just $12 to move the odds by 5 percentage points, which means a single large order can distort the price. A previous 2-point spike at 4:25 AM likely came from one bet, not a broad shift in sentiment.

The closure of the strait, combined with live fire on commercial shipping, is a real barrier to normalizing traffic by end of May. At 0.4¢, a YES share on fewer than 10 ships transiting pays $1. That bet only pays off if there’s a rapid diplomatic resolution, which current conditions don’t support.

Watch for statements from Iranian or U.S. officials on easing tensions or opening negotiations. Khamenei’s next public address or a Pentagon briefing could shift expectations quickly.

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