Polymarket

Strait of Hormuz Shipping Remains Crippled Amid Conflict, Polymarket Odds Reflect Deep Skepticism for May Recovery

A Polymarket prediction market tracking Strait of Hormuz shipping traffic by May 31, 2026, shows overwhelming odds against a return to normal, as geopolitical tensions continue to severely restrict vessel transits.

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— 3 min read

The critical Strait of Hormuz, a vital chokepoint for global oil and liquefied natural gas (LNG) shipments, remains under severe disruption, with a Polymarket prediction market reflecting overwhelming skepticism that traffic will return to pre-conflict levels by the end of May 2026. The market, with a significant trading volume of over $24 million, is poised to resolve to "Yes" if the IMF Portwatch 7-day moving average of transit calls reaches or exceeds 60 by May 31, 2026. However, current prices indicate a mere 3.25% chance for "Yes" against a 96.75% probability for "No".

This dire outlook is rooted in the ongoing conflict involving the United States, Israel, and Iran, which escalated dramatically in late February 2026. Following US-Israeli air strikes and the assassination of Iran's supreme leader, Iran retaliated with missile and drone attacks and subsequently moved to largely block shipping through the Strait of Hormuz. The US responded with its own naval blockade of Iranian ports, further exacerbating the crisis.

Before the conflict, the Strait typically saw between 125 and 140 ships transiting daily. However, since late February, maritime traffic has collapsed to a fraction of these levels. Reports from early May indicated traffic at less than 10 ships per day, with some analyses suggesting a 95% collapse in tanker traffic and an overall traffic rate of approximately 5% of its pre-war average across April. The latest available data from IMF Portwatch, the market's official resolution source, shows the 7-day moving average of transit calls for the Strait of Hormuz at a stark 6.29 as of May 17, 2026. This figure is dramatically far from the 60-vessel threshold required for a "Yes" resolution.

Adding to the complexity, Iran has asserted greater control over the waterway, imposing restrictions and, according to reports, establishing a new mechanism to regulate maritime traffic, including transit fees. Some vessels have reportedly paid as much as $2 million per transit, settled in Chinese yuan, to the newly formed Persian Gulf Strait Authority (PGSA). The US Office of Foreign Assets Control (OFAC) has warned that such payments could expose non-U.S. firms to secondary sanctions risks.

Despite ongoing diplomatic efforts between the US and Iran, with some reports of "slight progress" towards a deal that could eventually reopen the Strait, the immediate operational reality remains challenging. While Iran's semi-official news agency Tasnim reported on May 24, 2026, that Iranian authorities expect shipping traffic to return to pre-war levels within 30 days, this is an aspirational statement rather than a reflection of current conditions.

Experts highlight the severe economic repercussions of the prolonged disruption. The Strait of Hormuz closure has led to a global fuel crisis, significant increases in oil prices, and widespread supply chain disruptions, with consequences rippling across global economies. Given the current low transit numbers and the deep-seated geopolitical issues, a sudden surge in traffic to meet the 60-vessel average by May 31 appears highly improbable. The Polymarket odds accurately reflect this challenging and uncertain maritime environment.

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Market data fetched at 2026-05-25 00:17 UTC | Polymarket ID: 1809560

This article is generated by AI for informational purposes only. It does not constitute financial advice. Always do your own research before making any investment decisions. Data sourced from Polymarket and public web sources.

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