One Signature Short

A shooting war that opened February 28 has settled into something stranger: a ceasefire nobody fully signed, governing a strait nobody can use. Trump and Tehran hold a tentative memorandum that would extend the truce 60 days and reopen Hormuz. Neither has signed it. The deal exists as a draft and a set of leaks, not a binding instrument.

Terms are the most concrete they have been. Inside the 60-day window, Hormuz reopens with no tolls and Iran clears the mines it laid across the channel; in exchange, Washington lifts its naval blockade of Iranian ports and issues sanctions waivers, while Tehran commits to forgo nuclear weapons and to negotiate the disposal of its enriched uranium and a suspension of enrichment. That is a real framework, and it is one re-demand away from collapse.

The Pattern Holds

Every near-deal since April has drawn a maximalist counter from whichever side felt strong that week. Islamabad talks collapsed April 11-12; Washington answered with a port blockade. Trump called the reopening “largely negotiated” on May 23, then bolted fresh demands on Hormuz, enrichment, and frozen assets onto a tentative May 28 MoU, breaking it by May 29. The geopolitical desk reads the deadlock as a sequencing problem, not a terms problem: Iran will not clear mines (its only coercive card) before relief is irreversible, and Washington will not lift the blockade before transits resume and the nuclear file locks. Neither leader can move first.

Domestic ceilings make first moves costly. Trump’s defense secretary is signaling readiness to resume combat, which rewards claiming capitulation over compromise. Tehran is weaker: Khamenei is dead, the succession is contested, and Pezeshkian and Ghalibaf lack the single authority to sell concessions without the IRGC outflanking them. A weak center cannot make irreversible commitments. Late-May US “defensive” strikes in southern Iran, answered by Iranian ballistic missiles on Kuwait, mark the floor. Low-level kinetic exchange continues while the paper holds. Pakistan and Qatar carry the mediation; the likeliest exogenous trigger is Lebanon, where Netanyahu’s vow to intensify nearly broke the April 17 truce.

Closed on Water

Iran’s foreign minister declared Hormuz “open to all” on April 17 and oil fell 11 percent on the headline. The AIS picture never followed; open passages have run near zero since ~May 6. Mine-clearing is the long pole. MCM vessels sweep a few square nautical miles a day in a 21-mile strait, so certifying a safe Q-route takes weeks and assumes Iran cooperates and hands over its minefield records. May 25 reports had Iran still emplacing mines at Bandar Abbas, so the field is not even static.

Insurance is the second lock. War-risk premiums ran a few hundredths of a percent pre-crisis and spike to 1-2 percent of hull on a hot blockade, ~$1-2M on a $100M VLCC before any toll. P&I clubs can void cover for war-zone transits, which kills the blue cards a lawful port call requires; restoration lags any ceasefire by weeks. Backlog math compounds it: 600-plus tankers inside, 240-plus outside, against ~20M bbl/day of pre-crisis throughput, with no way to flush 800-plus hulls through one lane at once. DHL’s four-to-six-month read on normalization is the optimistic case, and the clock starts only at a signature.

The Premium Is Gone, The Relief Is Not

Brent trades near $93, recovering from a $91 Friday close on deal optimism. Brent hit a war high near $119 on April 1; by May 30 it had shed ~19%, its worst month since 2020, and the entire risk premium drained out. The screen prices a reopened strait while the water stays shut. That gap is the trade. Even a signature would not flush Iranian barrels into Brent-linked Western refineries. Trump can deliver OFAC relief unilaterally, and a general license for crude lifting issues in days, but it cannot touch the statutory secondary sanctions Congress codified (CISADA, IFCA), waivable only on rolling, time-limited certifications. A barrel sold under a 60-day waiver carries UN snapback risk on a 60-day clock, so it clears at a steep discount through intermediaries, not at the screen. Asset unfreezing is harder still: host banks moved nothing in the 2023 Qatar escrow case until OFAC cover landed, and that $6B was re-frozen within weeks.

Repricing has flipped the asymmetry. A signed MoU is largely in the tape, gated behind mine-clearing and P&I restoration that run weeks, so the upside on a signature is only ~$5-10. The under-priced branch is collapse: the framework dies, combat resumes around a still-mined, still-blockaded strait, and Brent snaps back toward $110-120, a $20-30 move. Traders have bought a resolution that remains a draft.

Reconciled Scenarios (energy weights x geopolitical probability)

The two desks reconcile on the ends. Energy’s combined “signed” outcomes, a clean reopening (40%) and a signed deal that stays commercially shut because mines, insurance, and reversible waivers gate the flow (35%), sum to ~75% for a deal landing at some point. That sits above the geopolitical desk’s ~55% estimate for a signature inside two to three weeks, with the gap being deals that close later than that window. Both desks converge on the ~25% tail to renewed combat.

What To Watch

Hull movement is the only hard signal; track whether laden transits actually rise, not whether a minister calls the strait open. Trump’s signature or his next re-demand are the two outcomes that have alternated for six weeks. Lebanon is the detonator to watch, having nearly broken the truce in April. On the relief side, demand the explicit general-license citation before treating any waiver as more than wind-down cover, and watch IAEA access, the gate on the nuclear half that Iran has kept shut. Ninety-four days in, the page that would change all of this is written. It is just not signed.