President Donald Trump signed an electronic memorandum of understanding with Iran on March 13, 2024 [1], to reopen the Strait of Hormuz.
The agreement aims to restore traffic through the narrow waterway linking the Persian Gulf with the Gulf of Oman. Because the strait is a critical artery for global trade, any prolonged closure or perceived instability threatens international energy markets and shipping costs.
Despite the agreement, the transition back to normal operations has been slow. Approximately 500 merchant vessels are currently waiting to cross the waterway [1]. These ships remain bottled up while captains and shipping companies evaluate the risks of entering the zone.
"The memorandum of understanding has already been signed electronically," Trump said [1].
However, the promise of safe passage has not yet convinced all maritime operators. Recent reports indicate that Iran fired on three ships and seized two of them within the strait [3]. These actions have contributed to a climate of uncertainty regarding the Islamic Republic's commitment to the deal.
Robert Sherman noted the ongoing instability of the region. "Ships are still waiting, and the safety of the strait is in question," Sherman said [2].
The memorandum was intended to secure an immediate reopening after Iran closed the strait during the war. While Iran has promised safe passage, the contradiction between these assurances and the recent seizure of vessels has left many merchant captains hesitant to move their fleets. The backlog of ships continues to grow as the international community monitors whether the ceasefire and the MoU will hold, or if the waterway will remain a flashpoint for conflict.
“"The memorandum of understanding has already been signed electronically."”
The persistence of a shipping backlog despite a formal agreement suggests a significant trust deficit between global maritime operators and the Iranian government. While the electronic MoU provides a legal framework for reopening, the actual flow of commerce depends on the perceived security of the route. The seizure of ships following the agreement indicates that geopolitical tensions may override diplomatic signatures, potentially keeping global oil and goods prices volatile.
