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Iran declares Strait of Hormuz closed as 'unauthorised' vessel hit - Headlines news and analysis from Global Banking & Finance Review
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Iran declares Strait of Hormuz closed as 'unauthorised' vessel hit

Published by Global Banking & Finance Review

Posted on July 11, 2026

5 min read

· Last updated: July 12, 2026

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US launches more strikes on Iran after commercial ship struck in Strait of Hormuz

Escalating Tensions and Military Actions in the Strait of Hormuz

By Steve Holland, Parisa Hafezi and Phil Stewart

US Military Response to Iranian Actions

WASHINGTON/DUBAI, July 12 (Reuters) - The U.S. military said it launched another round of strikes on Iran after the Islamic Revolutionary Guard Corps struck a container ship traveling through the Strait of Hormuz on Sunday.

A series of attacks between the U.S. and Iran over the past several days led President Donald Trump to declare the end of a ceasefire meant to halt the fighting that the U.S. and Israel began on February 28, though Trump has left the door open to continued negotiations.

Iran's Closure of the Strait and Threats of Retaliation

Iran said it closed the vital Strait of Hormuz after firing a warning shot that struck a vessel traveling on an unapproved route. It warned that any retaliation over the incident would be met with a "severe response."

U.S. Central Command identified the vessel as the M/V GFS Galaxy, a Cyprus-flagged container ship, saying it suffered significant engine-room damage and that a civilian crew member was missing.

Impact on Global Energy and Diplomacy

Strait of Hormuz: Strategic Importance and Economic Effects

STRAIT OF HORMUZ AGAIN THE FOCUS OF WAR, DIPLOMACY

The war has destabilized the Gulf, while Iran's effective blockade of the Strait of Hormuz has caused energy prices to surge, fuelling global inflation. Higher prices, especially for gasoline, are a politically sensitive issue for Trump ahead of November congressional elections.    

Iran said several ships attempted to move through the waterway on an "unauthorized route" and disregarded warnings to correct their course. The strait — which was a conduit before the war for one-fifth of the world's oil and LNG supplies — will remain closed until "the end of U.S. interference in this region," the Revolutionary Guards said.

US Strikes and Iranian Warnings

Central Command said it began its strikes at 7:15 p.m. ET (2315 GMT) on Saturday, roughly an hour after the Iranians released their statement, which included a warning that "new enemy bases" in the Middle East would be targeted if the United States retaliated for the container ship incident. 

Trump ordered the strikes, Central Command said. The White House did not immediately respond to a request for comment.

Diplomatic Efforts and Negotiations

US Demands and Iranian Response

Washington demands that Tehran publicly state it will stop attacks on ships in the strait — and that all lanes will be open without tolls, senior U.S. officials have said. 

Iran's Foreign Minister Abbas Araqchi has accused the United States of violating the ceasefire agreement. "There can only be mutual compliance," he wrote on X on Friday.

Sanctions and Regional Escalation

The U.S. revoked the license authorizing the sale of Iranian crude on Tuesday after three Qatari and Saudi commercial tankers came under fire earlier in the week, prompting the U.S. to hit Iranian sites. Iran then struck U.S. military sites in Gulf states.

While Iran has not claimed responsibility for the ship attacks, analysts say Tehran uses such actions to gain leverage in negotiations.

Ongoing Mediation Efforts

A senior Iranian source told Reuters that Iran, the U.S., Qatar and Pakistan had agreed to negotiate in a call that mediators were trying to arrange for Saturday while Araqchi was in Oman, a Gulf state trying to mediate an end to the war.

It was not immediately clear whether those efforts succeeded.

Iran's Vow of Retaliation and Leadership Transition

Funeral Ceremonies and Vengeance Promises

IRAN VOWS TO 'AVENGE THE BLOOD OF THE MARTYRED LEADER'

Araqchi and Omani Foreign Minister Badr Albusaidi met in Oman to exchange "views on appropriate mechanisms for the safe passage of ships through the Strait of Hormuz," according to a statement from the Iranian foreign minister. Oman's state news agency said Omani and Iranian negotiators would continue talks "at the technical and political levels." 

CNN reported on Saturday that Oman made a draft proposal for the strait, including free navigation through its southern corridor in Omani territorial waters. The plan called for vessels transiting the northern corridor through Iranian territorial waters to obtain prior approval from Iran, although no tolls would be imposed, CNN said.

The White House and State Department did not immediately respond to requests for comment on the CNN report.

A written statement from Iran's new supreme leader, Ayatollah Mojtaba Khamenei, on Saturday threatened vengeance for the death of his predecessor and father, who was killed in the war's initial attacks. It said the vengeance would take place whatever happened to Iran.

"We pledge to avenge the blood of the martyred leader and all the martyrs," the message said. 

The statement was released to mark funeral ceremonies for the former leader, Ayatollah Ali Khamenei, on Thursday. His son did not attend the ceremony and has not been seen in public since the war began.

Assassination Claims and Security Concerns

Trump had posted on Friday that he had ordered the U.S. military to be prepared to launch thousands of missiles against Iran if Tehran attempted to assassinate him.

The Wall Street Journal and other U.S. media reported in recent days that Israel had shared intelligence with Washington that Iran had recently devised a plan to assassinate Trump. 

Iran has not commented on the assassination claims.

At the funeral ceremonies on Thursday, a huge crowd of mourners packed a courtyard, some bearing banners reading, "We Will Kill Trump." 

(Additional reporting by Enas Alashray, Ahmed Elimam, Eman Abouhassira and Andrew Mills; Writing by Kim Coghill, Tom Perry, Philippa Fletcher and Alexandra Alper; Editing by Sergio Non, Cynthia Osterman and William Mallard)

Key Takeaways

  • Iran’s IRGC navy closed the Strait of Hormuz “until further notice” after striking a ship it said transited an unauthorized route (internazionale.it)
  • U.S. forces maintain the strait remains open and continue to monitor maritime traffic (investing.com)
  • Diplomatic efforts by Oman, Qatar and Pakistan aim to negotiate free but controlled navigation, possibly including service fees, amid broader U.S.–Iran tensions (axios.com)

References

Frequently Asked Questions

Why did Iran close the Strait of Hormuz?
Iran closed the Strait of Hormuz after a vessel traveled on an unauthorized route and was struck, citing maritime security concerns and retaliation threats.
How has the closure affected oil prices?
The effective blockade of the strait has caused energy prices to surge, fueling global inflation due to a significant percentage of the world’s oil supply passing through the area.
What was the United States' response to the incident?
The US demanded that Iran ensure all shipping lanes remain open with no tolls, and retaliated by hitting Iranian sites after commercial tankers were attacked.
Is mediation occurring to reopen the Strait of Hormuz?
Oman, Qatar, Pakistan, and the US are engaged in negotiation efforts, with Oman proposing draft plans for safe passage through defined corridors.
What broader impact has the strait’s closure had?
The closure has increased geopolitical tensions in the Gulf, disrupted global energy supplies, and contributed to a rise in oil and energy prices worldwide.

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