Strait of Hormuz traffic returns to normal by December 31?

The key point is that this is not a full-normalization question; it only needs IMF Portwatch to print a 7-day moving average of 60 or more at any time before year-end. That is materially easier than returning to prewar traffic, and the IMF’s own July 8 outlook explicitly assumes the Strait of Hormuz begins reopening in mid-July, with conditions normalizing only by March 2027. On that framing, a 60-plus rolling average before December 31 is plausible if the reopening actually holds.

The recent data, however, are still ugly. Reuters reporting over the last few days describes fresh attacks on vessels, U.S. retaliation, and tankers turning back from attempted transits, which is exactly the kind of behavior that suppresses the rolling average. PortWatch-linked reporting cited in the press suggests the most recent official daily counts were still only in the 30s to 40s, far short of the 60 threshold, and S&P Global said July 7 traffic was only modestly different from July 8 despite the attacks, which implies the recovery is fragile rather than complete.

My read is that the market is pricing in a decent chance of a diplomatic stabilization that restores shipping confidence later this year, but the path is much less certain than the headline probability suggests. Reuters also noted that Gulf exports had improved and backlog was clearing, which supports the idea that traffic can rebound quickly if security improves. Still, with renewed violence only days ago, the near-term trend is bearish for the threshold and the market needs a sustained move, not just a one-day spike, to qualify.