The Strait of Hormuz is open for business

The world’s most clogged waterway has reopened (temporarily), sending markets soaring and oil prices spiraling.

President Trump thanked Iran on social media for loosening its grip on the Strait of Hormuz, but maintained that the US’s own naval blockade would remain parked firmly in place until a peace deal is signed. Meanwhile, some shippers are leery of heading straight into the strait since they’ll have to detour from their prewar route and be at the mercy of the Iranian military.

Still, despite some jitters, the good news was enough to get markets moving. Here are today’s biggest winners and losers.

• Crude is cheaper: Brent crude futures, the worldwide benchmark, slid by 8.79% today to $90.65 per barrel.
• US oil stocks slumped: Exxon Mobil, Chevron, and Shell are down big time as the “war premium” padding their shares fades.
• Fertilizer freefall: An opened Strait means fertilizer and chemicals can once again flow out of the Middle East and to American farmers, punishing companies like CF Industries and Dow Inc.
• Cheaper fuel fuels cruise lines: Cruise ships are gas guzzlers, but the lower price of oil means that Royal Caribbean, Carnival, and Norwegian won’t be squeezed quite so badly.
• Airline stocks are flying high: Cheaper fuel helped airlines like United, American Airlines, Delta, and JetBlue soar. Today’s news might have also saved Spirit Airlines, which is on the brink of liquidating due to higher jet fuel prices.
• The dollar is down, wiping out all of its gains since investors flocked to the safe-haven asset when the war with Iran began.

What’s next? Now that oil is presumably free to flow through the Strait once again, fears of rising inflation are evaporating, and a Fed rate cut this year may be back in the running. Odds that the Federal Open Market Committee may lower interest rates in 2026 shot up from 29.5% on Thursday to over 45% today, according to the CME FedWatch Tool.

Yet although cheaper oil prices and a bullish stock outlook may seem to be in the cards, remember that it’ll take awhile before any oil makes its way to our shores. Plus, a lasting peace agreement hasn’t been signed just yet. Until that happens, it’s probably best to not buy blindly into market exuberance until the ink dries on a deal and gas prices settle back down into regular road trip territory.—JD