Will Strait of Hormuz traffic normalize by end of June 2026?
Live tracker for the Polymarket contract on whether Strait of Hormuz shipping returns to pre-crisis transit levels by June 30. Tracks daily transit counts, peace-talk status, sea-mine threats, IRGC posture, and war-risk insurance pricing. Currently trading 32.5% YES on Polymarket.
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The Takeby 2026-06-30
Strait of Hormuz traffic returns to pre-crisis levels by June 30, 2026
Market
33%
Our Call
24%
Δ
-9
Why we disagree
We sit 8 points below the market because (1) Trump's May 11 rejection of Iran's counterproposal removes the most plausible near-term track to political settlement, (2) sea-mine clearance and IRGC behavior changes both lag any political deal by 3-6 weeks operationally, and (3) the 600-tanker backlog compounds normalization friction — even with a deal, processing the queue takes weeks.
What changes our mind
**May 23 Rome talks outcome** — a breakthrough framework deal would shift our probability up by 12-15 points within 48 hours. Stall or walkout would shift down by 8-10 points.
All forecasts
02
The May 23 Rome peace talks produce a framework agreement
By 2026-05-25
Market
28%
Our Call
22%
Δ
-6
Why we disagree
Trump's May 11 rejection of the counterproposal narrows the path. Fifth round talks historically produce frameworks ~30% of the time when prior rounds have stalled. Pakistani mediation channel remains fragile per pre-summit reporting.
Why our call differs from market
We tilt below the base rate because the dynamic this week (Trump-Xi summit, post-rejection posture) doesn't favor breakthrough psychology. A framework requires both sides to concede on nuclear and sanctions language simultaneously.
The Strait of Hormuz crisis enters its third month with transit volumes still at just 15-28% of pre-crisis norms — roughly 17 vessels per day versus a normal baseline of ~60.
Polymarket prices the contract for end-of-June normalization at 32.5% YES with $4.8M+ in cumulative volume.
The contract is the closest tradeable proxy for whether the Iran war diplomatic track produces results before peak summer driving and Q3 supply tightness.
We hold 24% — 8 points below the market — because the structural conditions for normalization (sea mine clearance, war-risk-insurance reversion, IRGC posture change) all require political resolution that the May 11 Trump rejection of Iran's counterproposal made markedly less likely.
Current state: Transit at 15-28% of pre-crisis norms. ~17 vessels in the last 24 hours vs ~60 baseline. War-risk insurance premiums sit at 4.5% — roughly 30x normal.
May 11, 2026: Trump publicly rejected Iran's counterproposal in ceasefire negotiations. Markets priced this as a meaningful setback to near-term normalization.
May 23, 2026: Fifth round of peace talks scheduled in Rome — the key near-term swing factor for shipping insurance markets and Polymarket pricing.
Backlog: Over 600 tankers reportedly inside the Gulf awaiting safe transit windows.
Polymarket pricing across horizons: May 15 normalization 1%; May 31 normalization 10%; June 30 normalization 32.5%. The curve implies markets expect gradual but not complete normalization through summer.
IRGC vessel seizure continues to occur sporadically; each incident pushes pricing 2-4 points lower.
May 23 Rome talks outcome — a breakthrough framework deal would shift our probability up by 12-15 points within 48 hours. Stall or walkout would shift down by 8-10 points.
Daily transit count — the most direct measure. Sustained move above 35 vessels/day signals normalization underway; below 15 signals deterioration.
War-risk insurance premium — currently 4.5%. Below 2% would signal underwriter confidence in normalization.
Sea-mine clearance operations — minimal public reporting; any UN-sanctioned clearance mission would be a major positive signal.
Iranian Parliament position — public threats to close the Strait formally would invalidate normalization probability entirely.
Talks collapse at the May 23 Rome round — pushes our estimate to sub-15%.
Tanker attack or major incident before June 30 — base rate of one incident per 3-4 weeks given the current posture. Each incident is worth ~5-7 points on the contract.
Israeli or US strike on Iranian Strait infrastructure — would cause a step-change in pricing in either direction depending on outcome.
Quiet US-Iran backchannel breakthrough — historically unobservable until announced. Would justify a large probability swing.
Resolution-criteria interpretation — the Polymarket contract requires 'pre-crisis levels' which the platform has defined in resolution rules. Interpretation disputes possible but unlikely to be material.
Brent crude: Strongly correlated. A normalization scenario pulls Brent toward $75; sustained crisis keeps Brent above $90 with $110 spike scenarios on attacks.
Shipping insurance equities: Lloyd's of London consortium members and Marsh McLennan have moved on the premium environment. Normalization compresses underwriter margins.
Tanker rates: VLCC clean-tanker rates already elevated. Normalization scenario compresses the day-rate spike; continued crisis sustains it.
Asia energy importers: Japan, South Korea, India most exposed. Their hedging positions tell the institutional view; positioning data shows underweight Asia energy as a normalization-deferred trade.
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