28th Day of the Strait of Horm
Day 28 of the Strait of Hormuz blockade. Crude oil is WTI $99.64, Brent $112.57. President Trump states that "ceasefire negotiations are going well," but Iran has rejected a 15-point ceasefire proposal and continues to assert its sovereignty over the strait. Japan has begun releasing 80 million barrels of oil reserves, the largest scale in its history, but the structural vulnerability of 93% of crude oil imports passing through the Strait of Hormuz remains unchanged. On Polymarket, the probability of "crude oil reaching $100" plummeted from 44% to 24%, but this is not a sign of resolution — it is a manifestation of the "false optimism" created by Trump's ceasefire signals.
── Understand in 3 points ─────────
- • The U.S. and Israel launched a military attack on Iran. Supreme Leader Khamenei died, fundamentally collapsing the geopolitical balance in the Middle East.
- • Iran fully blockaded the Strait of Hormuz. The IRGC (Islamic Revolutionary Guard Corps) Navy cut off all navigation, instantly halting 20% of the world's oil supply.
- • WTI crude oil surged to $111.24. It recorded a 66% increase in just 9 days from $67.02 on February 27, reaching its highest level since 2022.
── NOW PATTERN ─────────
The spiral of conflict is self-reinforcingly expanding the dispute, and the overreach of power is blocking the exit from the conflict. The intersection of these two dynamics creates a structure of "false ceasefire negotiations," fixing structural volatility in the crude oil market.
── Probabilities and Responses ──────
• Optimistic Scenario 20% — Consider short positions in energy-related assets in preparation for a sharp drop in crude oil prices. Japanese electricity and gas stocks may temporarily rebound, but investment themes for structural energy transition (renewable energy, nuclear power plant restarts) remain valid in the medium to long term.
• Base Scenario 50% — Adjust portfolios based on the premise of a structural increase in energy costs. Energy-saving technologies and renewable energy stocks will benefit. As yen depreciation pressure intensifies, diversification into dollar-denominated assets, gold, and BTC is rational. The focus for Japanese export companies will be on passing on increased raw material costs.
• Pessimistic Scenario 30% — Full defensive positioning. Long positions in gold, BTC, and defense-related stocks; short positions in Japanese stocks and consumer-related stocks. Japanese energy security-related companies (nuclear power plant restarts, storage batteries, companies with long-term LNG contracts) are "beneficiaries of the crisis." Maximize international diversification, also considering dollar depreciation risk.
When will the Strait of Hormuz blockade end? → Read More (25 min) ↓
First analysis on this topic (starting point for future deltas)
📡 THE SIGNAL — What Happened
Why it matters: The de facto blockade of the Strait of Hormuz, through which 20% of the world's oil supply passes, has continued for nearly a month. While Trump's ceasefire diplomacy temporarily sways oil prices and Polymarket probabilities, structurally, the "spiral of conflict" has found no exit. For Japan's energy security, the most severe structural crisis since the 1973 oil crisis is currently unfolding.
- February 28, 2026 — The U.S. and Israel launched a military attack on Iran. Supreme Leader Khamenei died, fundamentally collapsing the geopolitical balance in the Middle East.
- March 4, 2026 — Iran fully blockaded the Strait of Hormuz. The IRGC (Islamic Revolutionary Guard Corps) Navy cut off all navigation, instantly halting 20% of the world's oil supply.
- March 8, 2026 — WTI crude oil surged to $111.24. It recorded a 66% increase in just 9 days from $67.02 on February 27, reaching its highest level since 2022.
- March 13, 2026 — Iran established the "Tehran Toll Booth." It began selectively granting passage permits through the strait, creating a system for collecting de facto "transit fees." So far, 26 vessels have used this system.
- March 16, 2026 — The Japanese government began releasing 80 million barrels of oil reserves, the largest scale in its history. IEA member countries agreed to a coordinated release totaling 400 million barrels.
- March 19, 2026 — The U.S. military launched an operation to forcibly reopen the Strait of Hormuz. However, due to Iranian mines, missiles, and coastal defenses, complete control of the sea has not been achieved.
- March 25, 2026 — Iran formally rejected Trump's 15-point ceasefire proposal. As a counter-proposal, it presented 5 conditions, including recognition of its sovereignty over the Strait of Hormuz.
- March 27, 2026 — WTI crude oil closed at $99.64 (+5.46%). Trump stated that "Iran allowed 10 tankers to pass," but on the same day, two Chinese container ships were denied passage.
The Strait of Hormuz is the world's most critical oil transit chokepoint. Approximately 20 million barrels of crude oil and petroleum products per day have been transported through this strait, which is only 33 km wide. About one-third of the world's seaborne oil trade and about 20% of liquefied natural gas (LNG) pass through here.
The strategic importance of this strait was first demonstrated during the "Tanker War" of the Iran-Iraq War in the 1980s. From 1984 to 1988, a total of 546 merchant ships were attacked by both sides, exposing the vulnerability of the global oil supply system. The U.S. launched "Operation Earnest Will" in 1987, escorting Kuwaiti tankers flying the U.S. flag. This historical experience teaches that conflict in the Persian Gulf does not resolve in the short term.
In June 2019, Iran shot down a U.S. drone and carried out drone attacks on Saudi Arabian oil facilities, raising tensions in the Strait of Hormuz again. However, at that time, it did not escalate into a full-scale military conflict, and the rise in crude oil prices was temporary. The Trump administration (first term) had previously halted military retaliation against Iran at the last minute, stating it was "not a proportional response."
However, in 2026, the situation is qualitatively different. The death of Supreme Leader Khamenei in the U.S.-Israeli attack on February 28 transformed Iran's decision-making structure itself. The loss of the Supreme Leader became a justification for "holy revenge" for hardliners within Iran, and the blockade of the Strait of Hormuz is positioned not merely as a military tactic but as a "holy war" for the nation's survival.
For Japan, the Strait of Hormuz is its lifeline. 93% of Japan's crude oil imports pass through this strait, and the country relies on imports for 87% of its total energy supply. This structural vulnerability is a problem Japan first acutely felt during the First Oil Crisis in 1973. The oil embargo by OAPEC (Organization of Arab Petroleum Exporting Countries) caused Japan's GDP growth rate to plummet from 11% to negative, forcing it to transform into an "energy-saving nation."
Fifty years later, Japan's energy security remains essentially unchanged. While the 7th Strategic Energy Plan advocates for maximum utilization of nuclear power, the restart of nuclear power plants after the Fukushima accident has been slow, and dependence on fossil fuels remains high. The current Hormuz blockade is confronting Japan with the structural vulnerability of its energy structure, which it has postponed for 50 years, in the most brutal way.
A public opinion poll conducted by the Asahi Shimbun on March 14-15 showed that 90% of respondents were concerned about the impact of this conflict on the Japanese economy. Prime Minister Sanae Takaichi announced the release of oil reserves on March 16, but the release of 80 million barrels (45 days of domestic demand) is merely a temporary measure that postpones the problem. Japan's total oil reserves are 470 million barrels (254 days' supply), and if the blockade is prolonged, they will eventually run out.
🔍 Between the Lines — What the News Isn't Saying
The contradiction between Trump stating "negotiations are going well" and Iran denying any negotiations. What is not officially being said is the possibility that the U.S. is not necessarily prioritizing the "full reopening" of the Strait of Hormuz. If partial passage through the "Tehran Toll Booth" is maintained, crude oil prices would stabilize around $100, a favorable price level for the U.S. shale oil industry. In other words, the "compromise" for the U.S. might be the "worst-case scenario" for Japan — a prolonged "gray zone" that is neither a full blockade nor a full reopening would fix structural increases in energy costs, quietly eroding Japan's industrial competitiveness.
NOW PATTERN
Spiral of Conflict × Overreach of Power
The spiral of conflict is self-reinforcingly expanding the dispute, and the overreach of power is blocking the exit from the conflict. The intersection of these two dynamics creates a structure of "false ceasefire negotiations," fixing structural volatility in the crude oil market.
Spiral of Conflict: The 'Structure Without an Exit' Born from a Chain of Retaliation
The U.S.-Israeli attack on Iran on February 28 resulted in the irreversible death of Supreme Leader Khamenei. For Iran, this is not merely a military loss. The assassination of the Supreme Leader is an event that shakes the very foundation of the Islamic regime's legitimacy, making it impossible to maintain the regime without "holy revenge." The blockade of the Strait of Hormuz is Iran's most powerful asymmetric card, and "laying it down" would domestically signify the regime's defeat.
The IRGC reiterated that "the Strait of Hormuz is closed, and any passage will face severe consequences."
— CNBC, March 25, 2026
An Iranian spokesman denied that any direct negotiations had taken place between Tehran and American officials since the attacks began on February 28.
— NBC News, March 27, 2026
These two quotes illustrate the core characteristic of the spiral of conflict. Iran has not "closed" the strait; it "cannot open" it. The irreversible death of Khamenei has fundamentally altered Iran's domestic political dynamics. In the power struggle for the new Supreme Leader, everyone is trying to avoid the label of "weakness." The IRGC (Revolutionary Guard Corps) has positioned the strait blockade as a symbol of national defense, creating a political environment where any concession would be attacked as "betrayal of the martyr Khamenei."
The U.S. side is similarly locked in. President Trump repeatedly stated that "negotiations are going well" and described Iran's "passage of 10 tankers" as a "gift." However, this narrative is one-sided, given Iran's denial. The more Trump constructs a narrative of "negotiation success," the greater the cost when an actual agreement fails to materialize. Failure in negotiations directly questions Trump's diplomatic capabilities, forcing him into a half-hearted response of continuously extending deadlines (attack moratorium until April 6).
This is the essence of the spiral of conflict. Neither side has an incentive to "back down first." If Iran opens the strait, it loses the regime's legitimacy domestically; if the U.S. attacks, oil prices will soar further, directly hitting American consumers, and if it concedes, it projects an image of a "weak America" to the world. This structure will not resolve itself without an external shock (e.g., internal collapse of the Iranian regime or the emergence of an unexpected mediator).
Overreach of Power: The Cost of a 'Two-Front War' — Trump's Concurrent Crises
The Trump administration is currently pursuing at least three major policies simultaneously: the Iran war, tariff policies under Section 122 of the Trade Act, and domestic tax cut bills. All three require significant resources (military, diplomatic, and political capital) and present conflicting demands.
Trump extended the moratorium on attacks on Iranian energy facilities by 10 days, setting a new deadline of Monday, April 6, at 8 p.m. ET. He said, "Negotiations are ongoing and going well."
— NPR, March 26, 2026
Iran rejected the U.S. proposal, presenting five conditions including "a complete cessation of attacks and assassinations" and "recognition of Iran's sovereignty over the Strait of Hormuz."
— CNBC, March 25, 2026
The chasm between these two quotes is a classic symptom of the overreach of power. Trump is buying time by granting a "10-day moratorium," but this moratorium itself sends a signal to Iran that "the U.S. is not serious about attacking." Extending the deadline can be reinterpreted as "postponing a decision."
Why can't Trump immediately escalate? The answer lies in the overreach of power. Destroying Iran's energy facilities would easily push crude oil prices above $120, directly hitting American consumers with soaring gasoline prices. At the same time, Trump is maintaining tariffs under Section 122 of the Trade Act, and rising supply chain costs are already pressuring the domestic economy. The double blow of soaring oil prices from an Iran attack and rising costs from tariffs would be a fatal political risk heading into the 2026 midterm elections.
On the other hand, if Trump makes significant concessions to Iran, he would be criticized by domestic hardliners and Republican hawks for "weak diplomacy." Israel's Netanyahu government would also not tolerate an easy compromise with Iran. Trump is caught in a "double bind," unable to pursue military escalation or diplomatic concessions.
The lessons of history are clear. Overstretched hegemons overestimate their ability to manage multiple conflicts simultaneously. The Roman Empire's two-front wars, Britain's overconfidence during the 1956 Suez Crisis, America's Middle East policy after the 2003 Iraq invasion — in all cases, multiple fronts believed to be "controllable" cannibalized each other's resources and became quagmires. Trump's current situation is the latest example of this historical pattern.
Intersection of Dynamics
At the intersection of the spiral of conflict and the overreach of power lies the essence of the current volatility in the crude oil market. Trump wants to stop the "spiral of conflict" (because the cost of escalation is too high), but due to the "overreach of power," he cannot concentrate sufficient resources and political capital to stop the spiral. This contradiction leads to half-hearted responses such as "deadline extensions," "optimistic rhetoric," and "partial gestures (10 tankers allowed to pass)," ultimately prolonging the conflict.
For the crude oil market, this structure represents the worst-case scenario. A full escalation (a surge above $120) would allow the market to price it in and adapt. A complete ceasefire (a return to $70-80) would resolve uncertainty. But the reality is "neither" — Trump's ceasefire signals temporarily push prices down, and Iran's rejections push them back up, creating a pendulum swing. This "structural volatility" fundamentally destabilizes the energy plans of oil-importing countries, including Japan.
📚 Pattern History
1988: Tanker War (1984-1988) — A Template for Long-Term Instability in the Persian Gulf
The "Tanker War" during the Iran-Iraq War was the first case that proved that conflict in the Persian Gulf would not end quickly. In 1984, when Iraq attacked Iran's oil export facility, Kharg Island, both countries began targeting each other's oil tankers and oil infrastructure. Over four years, 546 merchant ships were attacked, and insurance premiums soared to 50 times their normal rates.
The U.S. launched "Operation Earnest Will" in 1987, escorting Kuwaiti tankers flying the U.S. flag. This operation secured safe passage through the strait to some extent but did not end the conflict itself. In April 1988, the U.S. Navy carried out "Operation Praying Mantis," destroying Iranian oil platforms and sinking several Iranian naval vessels. However, Iran did not surrender, and the conflict finally ended with a ceasefire in August 1988, driven by UN Security Council resolutions and the exhaustion of both Iran and Iraq.
The similarities with the present day in 2026 are striking. Even then, the U.S. intervened believing it could "open the strait by military force," but Iran's asymmetric warfare capabilities (mines, small fast boats, anti-ship missiles) made it difficult to secure complete control of the sea around the strait. Thirty-eight years later, Iran's anti-ship capabilities have evolved further, making a repeat of "Operation Earnest Will" even more challenging than it was then.
Structural similarity with the present: Spiral of Conflict: The recurrence of a structure where military intervention does not end conflict but prolongs it.
1973: First Oil Crisis and Japan — 50 Years of Unresolved Energy Dependence
In October 1973, against the backdrop of the Fourth Middle East War, OAPEC (Organization of Arab Petroleum Exporting Countries) imposed an oil embargo. Japan's crude oil supply instantly fell into a critical situation, leading to long queues at gas stations and a panic buying frenzy for toilet paper ("Oil Shock") becoming a social phenomenon.
The economic impact was devastating. Japan's GDP growth rate plummeted from +11.7% in 1973 to -0.5% in 1974, and inflation surged to 23%. This crisis fundamentally changed Japan's industrial structure, prompting innovation in energy-saving technologies, promotion of nuclear power generation, and the establishment of an oil reserve system. The enactment of the Petroleum Stockpiling Law in 1975 led Japan to build one of the world's most robust oil reserve systems. The current 470 million barrels (254 days' supply) is its legacy.
However, the fundamental problem remains unresolved after 50 years. Japan's energy self-sufficiency rate is only about 13%, and 93% of its crude oil imports still pass through the Strait of Hormuz. The lesson of 1973 led to tactical symptomatic treatments like "reserves" and "energy saving," but the strategic challenge of "decoupling from Middle East dependence" has been continuously postponed. The Fukushima nuclear accident in 2011 sharply reduced reliance on nuclear power, resulting in a rapid increase in dependence on LNG (liquefied natural gas) and coal, thereby deepening energy dependence via the Middle East.
The 2026 Hormuz blockade is forcing Japan to settle the structural vulnerabilities it has postponed for 50 years. The release of 80 million barrels of reserves is merely a "buying time" tactic, reminiscent of 1973. The question is how Japan will prepare for the "next Hormuz crisis" that will likely continue even after the current blockade is lifted.
Structural similarity with the present: Overreach of Power × Path Dependence: A pattern where structural vulnerabilities are exposed during each crisis, but fundamental solutions are postponed.
Patterns from History
The two historical parallels demonstrate the lesson that conflict over the Strait of Hormuz should not be expected to have a "short-term resolution." The Tanker War lasted four years, and the impact of the oil crisis continued for over a decade. And Japan, by reducing the lesson of 1973 to a tactical solution of "reserves," has postponed the structural shift towards energy independence for half a century. The 2026 crisis is confronting Japan with the cost of this postponement in the most brutal way.
🔮 Next Scenarios
A comprehensive ceasefire agreement is reached, and the Strait of Hormuz is fully reopened. Iran lifts the blockade on condition of "partial sovereignty recognition" (e.g., joint IRGC patrol rights in the strait), and the U.S. promises gradual sanction relief. Crude oil prices plummet to WTI $70-80, and Japan's oil reserve release is halted. However, the power vacuum in Iran (Khamenei's succession issue) remains a destabilizing factor, so the market does not fully price in a "peace discount."
Investment/Action Implications: Consider short positions in energy-related assets in preparation for a sharp drop in crude oil prices. Japanese electricity and gas stocks may temporarily rebound, but investment themes for structural energy transition (renewable energy, nuclear power plant restarts) remain valid in the medium to long term.
The conflict transitions to a "frozen state," and the "Tehran Toll Booth" in the Strait of Hormuz becomes a semi-permanent institution. Iran permits passage for a certain number of vessels (20-30 per day), but this is far from the 110 vessels/day before the blockade. Crude oil prices remain high at WTI $85-100, and volatility becomes normalized. Japan continues the gradual release of oil reserves while exploring alternative procurement routes (Russian oil via pipelines, spot purchases of African crude), but increased costs are unavoidable. Electricity prices rise by 20-30%, reducing the cost competitiveness of the manufacturing industry.
Investment/Action Implications: Adjust portfolios based on the premise of a structural increase in energy costs. Energy-saving technologies and renewable energy stocks will benefit. As yen depreciation pressure intensifies, diversification into dollar-denominated assets, gold, and BTC is rational. The focus for Japanese export companies will be on passing on increased raw material costs.
Trump launches a full-scale attack on Iran's energy facilities after the April 6 deadline. Iran declares an acceleration of its nuclear development ("breakout"), and proxy wars intensify across the Middle East. Houthi forces blockade the Bab el-Mandeb Strait, causing both major global oil transport chokepoints to simultaneously fail. Crude oil prices surge to WTI $120-150, and the global economy enters stagflation. Japan faces rapid consumption of oil reserves (risk of depletion in 6 months) and an electricity crisis, with its economic growth rate falling into negative territory. This would be a recurrence of the 1973 oil crisis.
Investment/Action Implications: Full defensive positioning. Long positions in gold, BTC, and defense-related stocks; short positions in Japanese stocks and consumer-related stocks. Japanese energy security-related companies (nuclear power plant restarts, storage batteries, companies with long-term LNG contracts) are "beneficiaries of the crisis." Maximize international diversification, also considering dollar depreciation risk.
Key Triggers to Watch
- April 6 — Trump's Deadline for Iran Attack Moratorium: The final deadline for Trump's "moratorium on attacks on Iranian energy facilities." If the deadline is extended again, the "frozen conflict" scenario is strengthened. If an attack is carried out, it shifts to an escalation scenario.
- April 5 — OPEC+ Meeting: Discussion on expanding production volumes (206,000 barrels/day) from April. The focus is on evaluating the structural problem that increased production cannot reach the market as long as the Hormuz blockade continues.
- Q2 2026 — Election of Iran's New Supreme Leader: If Khamenei's successor is decided, Iran's negotiating stance will become clear. If a hardline IRGC-affiliated candidate is chosen, a long-term blockade is likely; if a moderate is chosen, a window for negotiations may open.
- Japan's Reserve Consumption Pace: After the release of 80 million barrels (45 days' supply), a decision on further releases will be imminent. The timing when the risk of depletion of total reserves of 470 million barrels becomes apparent will be the next decision point.
Market Consensus (Polymarket)
※ Real-time odds from prediction markets. Higher trading volume indicates higher reliability.
Will Crude Oil (CL) hit $100 by end of March 2026? Vol: $0.8M
Source: Polymarket (gamma-api)
🔄 Tracking Loop
Next Trigger: April 6: Trump's deadline for the moratorium on attacks on Iranian energy facilities. A crossroads between re-extension or attack upon expiration.
Continuation of this pattern: The 'Hormuz Crisis and Japan's Energy Security' Series: ① Temporary Hormuz Blockade (Feb) → ② Full Blockade and Toll Booth System (Mar) → ③ Battle over Ceasefire Negotiations (This Article) → ④ Outcome of the April 6 Deadline → ⑤ Impact on Japan's Energy Structure Transformation
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