Oil prices drop 10% as Trump confirms Strait of Hormuz is fully open

Oil prices dropped 10% after President Trump announced the Strait of Hormuz is fully open, matching Iran’s statement. The market on whether Trump will announce the lifting of the US blockade by May 31 sits at 87% YES.

Market reaction

The April 17 market closed at 8% YES, meaning traders didn’t expect an announcement before today. The April 19 market is at 27% YES, up from 13% yesterday, showing traders remain cautious about an imminent formal announcement.

Why it matters

The May 31 market holding at 87% YES points to confidence in a longer-term resolution. This market trades $7,205/day face value, with actual USDC volume at $5,868. It takes $3,730 to move the price 5 points. The biggest move was a 2-point spike at 2:38 AM, from 79% to 81%.

What to watch

The April markets are nearing resolution, but the May 31 market is where the real action is. A YES share at 82¢ pays $1 if the blockade is lifted by May 31, a 1.22x return. Traders are pricing in continued US-Iran compliance with ceasefire terms. The next key signal is likely a formal statement from the White House or Iranian state media detailing the blockade’s end.

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