US naval blockade pressures Iran into drastic oil export measures

The US naval blockade is squeezing Iran’s oil exports, forcing Tehran into drastic actions. The likelihood of the blockade being lifted by May 31 sits at 57% YES, down from 72% just 24 hours ago.

Market reaction

The May 31 blockade-lift market has moved sharply, with odds dropping from 90% a week ago to the current 57%. Traders sold off after a WSJ report detailing Iran’s desperate attempts to maintain oil exports under the blockade. The contract has daily face value of $152,453, with actual USDC traded at $95,253. It takes just under $9K to move the odds by five points, indicating moderate liquidity.

Why it matters

The WSJ report points to ongoing disruptions in the Strait of Hormuz affecting global oil flows. Iran’s extreme measures to keep exporting could intensify tensions and reduce the chances of traffic normalization by the end of June. Odds for a return to normal traffic levels in the Strait of Hormuz by June 30 could reflect this pessimism, though exact figures were not provided.

What to watch

At 57%, a YES share for the May 31 market pays $1 if the blockade is lifted, offering a potential 1.75x return. That payout looks attractive only if you expect a diplomatic breakthrough, and current conditions point the other way. Watch for official announcements from the US or Iranian governments, particularly statements from President Trump or the Iranian Foreign Ministry. Any signs of negotiation progress or new escalation could move this market fast.

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