Hormuz truce expires as Tehran puts a bounty on American soldiers

The sixty-day truce signed in June under the Islamabad memorandum has expired without being replaced by a more durable agreement. The standoff between the United States and Iran over the Strait of Hormuz is back where it started, with harder positions on both sides.

President Donald Trump announced that he intends to designate the strait as United States territory "very soon". Iran's reply came from deputy foreign minister Kazem Gharibabadi, who called the threats misplaced. "The Strait of Hormuz cannot be conquered with a tweet, nor with an aircraft carrier, nor with an order," he said. According to Gharibabadi the passage "will be closed and reopened only on Iran's command".

Tehran has meanwhile announced a bounty of thirty thousand dollars for every American soldier. The Revolutionary Guard is maintaining the block on transit, while the United States Navy continues its naval blockade off Iranian ports. Iran's parliament passed a bill on the security of the strait and a package of measures against what it describes as foreign interference.

A fifth of the world's oil

About a fifth of the oil and gas traded worldwide passes through Hormuz. A prolonged closure of the passage therefore feeds through quickly to energy prices in Europe and in Switzerland, which imports all the fuel it consumes. Treasury Secretary Scott Bessent announced new economic measures against Iran without setting out their content.

On the American domestic front the bill is already visible at the pump. Petrol has passed four dollars a gallon, a level that weighs on the political debate three months before November's midterm elections.

Unofficial channels remain open. Trump was reported to have tried in May to reach Revolutionary Guard commander Ahmad Vahidi through the president of Iraqi Kurdistan, Nechirvan Barzani. Iranian army commander Amir Hatami repeated that the armed forces are ready to respond to any attempt to force the passage. Neither side has so far named a date for the resumption of negotiations.