US-Iran Ceasefire Appears to Collapse Amid Strait of Hormuz Attacks

Has the fragile US-Iran ceasefire collapsed?

The Iran war has reignited after Tehran struck at least three commercial vessels in the Strait of Hormuz on Tuesday, according to US and maritime officials.

The attacks, which targeted a Saudi oil tanker and a Qatari liquefied natural gas (LNG) carrier, prompted the United States to revoke the temporary sanctions waiver on Iranian oil exports.

This major concession in the memorandum of understanding (MOU) agreed by the US and Iran last month allowed Tehran to restart oil exports after its tankers were halted by a US Navy blockade.

In further retaliation, US Central Command (CENTCOM) said Wednesday it had struck more than 80 targets in Iran, including air defense systems, radars and over 60 small boats used by Iran's Islamic Revolutionary Guard Corps (IRGC) to harass shipping.

CENTCOM said it wanted to "impose heavy costs for targeting and attacking commercial shipping crewed by innocent civilians in an international waterway."

Iran then hit back by launching fresh missile strikes on Gulf nations on Wednesday, with air raid sirens and explosions reported in Bahrain and Kuwait.

Reacting to the escalation, maritime security firm MARISKS warned Wednesday that the tit-for-tat action "marks a return to direct military confrontation."

Speaking ahead of a NATO summit in Turkey, US President Donald Trump said the MOU with Iran was now "over," adding that "It’s just a waste of time dealing with them [Tehran]."

China and Qatar, meanwhile, called for an immediate de-escalation, while German Defense Minister Boris Pistorius called on Tehran to stop provoking Washington and cease attacks on vessels.

Why is Iran again targeting ships in Hormuz?

Iran is trying to maintain its control over Hormuz, the narrow waterway that before the war carried a fifth of the world's oil and gas exports from the Gulf to the rest of the world.

Iran effectively closed the strait after US-Israeli airstrikes killed several Iranian officials, including Supreme Leader Ali Khamenei, on February 28. Later, Iran struck around a dozen ships caught in the strait, before a fragile ceasefire deal was reached last month.

In the days leading up to Tuesday’s attacks, peace talks had made little progress on the many outstanding issues, including long-term US sanctions relief and Iran's nuclear ambitions.

Iran has repeatedly used Hormuz as leverage in negotiations when diplomatic progress is stalled, as well as strikes on Gulf nations like Saudi Arabia, the United Arab Emirates and Qatar.

Attacking these major oil-producing nations and key allies of the US is seen by Tehran as a way to pressure Washington and spread instability so the Middle East region feels the cost of the war.

What leverage does Iran really have?

Repeated US-Israeli strikes has decimated Iran's military. As Tehran cannot beat the US military in a conventional conflict, it is using asymmetric warfare as leverage.

While Iran does not legally own the strait, it does control the northern shore, several strategic islands and a coastline that allows the IRGC to monitor and threaten passing vessels.

Iran then relies on fast-attack boats, coastal missiles, mines and drones to strike tankers, disrupting the world's energy supply without a full naval battle.

According to reports, Iran has also begun charging tolls of up to $2 million (€1.75 million) per ship for safe passage through Hormuz, a move decried by maritime experts as illegal and unenforceable.

Tehran's leverage, however, is not unlimited. The US responded with its own naval blockade in Hormuz, preventing Iranian ships from exporting oil, thus cutting a vital source of income.

Iran had been exporting oil in defiance of US sanctions, primarily to China, at below market prices.

Tehran uses a shadow fleet of tankers that frequently change flags, disable tracking and use ship-to-ship transfers to evade detection.

Yet, without the sanctions waiver and the US Navy blockade potentially restarting, the Iranian regime now risks full economic collapse.

According to the Washington-based think tank Foundation for Defense of Democracies, Iran has suffered $144 billion in economic damage from the war, plus billions more in lost oil sales during the blockade.

The country's currency, the rial, has collapsed to record lows of around 1.7 million to the dollar, and inflation has surged to over 88%.

So what happens now?

In its latest statement, MARISKS said that the revoking of Iran's sanctions waiver "undermines the political foundation" of the peace deal "and reduces incentives for continued restraint."

The maritime intelligence firm warned that "the probability of further escalation has increased substantially."

While Trump said negotiations would likely continue, he labeled Iran as led by "sick people" and said he didn't want to engage with the regime.

Bloomberg cited an anonymous US official as saying that Tehran needed to behave responsibly to enjoy the benefits that the MOU offered. The official, however, said US negotiators would continue to act in good faith.

But Iran remains defiant, with Parliament Speaker Mohammad Bagher Qalibaf warning on X that: "The era of bullying and extortion is over. It leads nowhere. We don’t fold."

As oil prices rose 5% on the latest escalation, some experts warned that further US strikes were unlikely to change Tehran's strategy.

"Instead, they risk pushing both sides further away from the negotiated outcome that ... both Washington and Tehran still appear to prefer," Dennis Citrinowicz, a visiting fellow at the Atlantic Council think tank, wrote on X.