〔Day Digest〕MOU Expiry Without Extension Keeps Hormuz Shut, Crossings in Single Digits vs 110/Day, Brent at $91.04 – Diesel Crunch and $200-500M Spill Cleanup Offset Rerouting

0. Weekly Arc

The 60-day US-Iran memorandum lapsed with President Donald Trump saying he will not extend it, and Iran's parliament speaker Mohammad Baqer Qalibaf saying the Strait of Hormuz stays shut until Washington unfreezes Iranian assets, lifts oil sanctions and ends military threats ^[1][2][3]. Brent held $91.04 and WTI $84.95 while shipping data showed just single-digit Hormuz crossings against a pre-war daily average of about 110 ^[4][5]. Yet physical supply is finding workarounds: China's state shippers keep tankers outside the Gulf, Saudi Arabia has resumed loadings from inside the strait, and one VLCC fixture to East Asia cleared at $31 million ^[6][7][8]. The next test is whether an unconfirmed Houthi drone strike on Saudi Aramco's JAZAN refinery and a spreading diesel shortage force a wider repricing ^[9][10].

1. Policy Narrative

• **[NEW] US – President Donald Trump:** says he is not interested in extending the expiring agreement, and separately threatened to bomb Oman, claiming the Gulf state could hinder a peace deal ^[1][11][12]. The threat is carried by Jin10 and not yet confirmed by other sources ^[11].
• **[NEW] Iran – Parliament Speaker and top negotiator Mohammad Baqer Qalibaf:** Hormuz will not reopen until the US meets interim-deal conditions – unfreezing Iranian property, lifting oil sanctions, ending military threats and actions, and satisfying other memorandum terms ^[2][3]. He said Iran is prepared to strike harder against any "transgression" by hostile forces ^[2].
• **[ONGOING] Turkey – President Recep Tayyip Erdogan** and Foreign Minister Hakan Fidan held multiple calls with both sides; Erdogan spoke with Trump on 17 August, calling for maximum diplomacy and offering Turkish support ^[13].
• **[ONGOING] UN – Secretary-General spokesman Stéphane Dujarric:** reiterated that there is no military solution and urged Washington and Tehran to resume talks quickly ^[14].

2. Key Data and Market Read

• **[NEW] Prices and flows:** Brent rose 0.1% to $91.04 a barrel, WTI rose 0.5% to $84.95, with oil advancing for a third day; Treasuries sold off amid the geopolitical headlines ^[4][15][12]. The yen hit a two-and-a-half-week low, with USD/JPY touching 159.77 intraday, as low FX volatility supported carry trades, according to ING analyst Chris Turner ^[11].
• **[ESCALATED] Shipping chokepoints:** Hormuz crossings were still in single digits on Monday, up only slightly from the weekend, per preliminary Reuters shipping data ^[16]. MarineTraffic data showed at least three commercial ships transited Hormuz in the past 24 hours versus a pre-war average of roughly 110 per day, while Bab el-Mandeb saw at least 37 ^[5]. UKMTO received a report of a vessel struck by an unknown projectile while outbound, causing engine-room damage and a crew casualty; the rest were assisted by the Omani Coast Guard ^[17][18].
• **[NEW] Supply workarounds:** China's state shippers are deploying tankers outside the Gulf to avoid chokepoints ^[6]; Saudi Arabia has resumed oil loadings and sales from inside the strait ^[7]; and Asian refiners are asking to receive Saudi crude at Egyptian ports to avoid the Red Sea ^[19]. Saudi Arabia is also supplying from near the Omani coast, signaling a shift in transshipment strategy ^[19]. VLCC earnings for Middle East routes are near a two-month high, with the "Mongolia Prosperity" fixed at $31 million for a single voyage to East Asia ^[8].

3. Contrarian and Tail Risks

• **[NEW] Houthi escalation:** The Houthis claim a drone attack on Saudi Aramco's JAZAN refinery, but Riyadh has not confirmed it ^[9]. The group is also intensifying attacks on Yemen's Red Sea coast, moving closer to Bab el-Mandeb ^[4].
• **[NEW] Diesel supply crisis:** A global diesel shortage is spreading as Russian refineries are attacked and Middle East transport risks rise; Europe, Brazil and Turkey are competing for limited cargoes while the US – the largest supplementary source – faces low inventories ^[10].
• **[NEW] Oman spill costs:** Salvors are trying to recover a sinking shadow-fleet Suezmax, the Caroline Bezengi, grounded off Oman's southern coast; cleanup may cost $200-500 million, according to Marisks CEO Dimitris Maniatis ^[20].
• **[NEW] Structural investment shift:** The crisis is pushing the US, Norway and Canada to expand fossil-fuel investment – the EIA projects a record US crude output of 14.21 million bpd by end-2026, Norway is restarting three North Sea gas fields closed for nearly 30 years, and Equinor has committed $6 billion per year; energy security is trumping climate goals ^[21].