Iran's Mortazavi confirmed the incorporation of the Caspian Sea into supply networks for vital goods due to persistent issues in the Strait of Hormuz. Currently, the likelihood of 80 ships transiting the Strait on any given day by April 30 stands at just 0.7%, significantly down from 4% earlier.
Traders are responding to Iran's strategic move towards the north, interpreting it as a sign of ongoing disruptions in Hormuz. The market prediction for April 30 has plummeted from 51% last week to its present level, reflecting a deep skepticism about any potential resolution in the near future. With only six days remaining until the market's decision, the chances for normalizing traffic through Hormuz appear almost nil.
The current trading volume within the Hormuz transit market remains minimal, illustrating a face value of $10,129 per day but with actual transactions amounting to just $449 in USDC. The lack of depth in the order book indicates that a mere $542 can cause the market to fluctuate by 5 points. Such illiquidity not only leads to volatile price movements but also underscores a lack of confidence in a swift resolution.
Mortazavi's announcement signals Iran's approach to funnel goods through the International North-South Transport Corridor, leveraging the Caspian Sea to lessen reliance on Hormuz for food security. For traders, this indicates prolonged tensions, reducing the likelihood that major shipping lines will recommence services in the Gulf anytime soon. Purchasing YES at 1 cent could yield a 100 times return, but only if a significant change occurs within the week.
Investors should stay alert for any updates from the IRGC or Iran’s Foreign Ministry, as modifications to toll systems or transit protocols could significantly impact these markets.