Strait of Hormuz Shipping Contracts 95%! Gold and Bitcoin Pull Back, Six Countries Issue Joint Statement

Since the United States and Israel launched military actions against Iran, the daily shipping volume through the Strait of Hormuz connecting the Persian Gulf to global markets has plummeted by approximately 95%, triggering chain reactions in the global energy and capital markets. Gold has fallen for seven consecutive days, with Bitcoin also retreating. The UK, France, Germany, Italy, the Netherlands, and Japan issued a joint statement, pledging to take necessary actions to ensure the safe passage of ships through the Strait of Hormuz, in an effort to mitigate further shocks to energy prices.

Hormuz Strait Crisis: Market Chain Reactions from Blocked Shipping Routes

The Strait of Hormuz is the world’s most critical oil and natural gas transportation corridor, with about 20% of global seaborne oil passing through daily. It is also the only outlet for several major Middle Eastern LNG producers. The 95% reduction in shipping is not a temporary fluctuation but a substantial disruption to the global energy supply chain.

The blockage of key routes has triggered multiple market reactions—investors are selling precious metals to increase cash liquidity while seeking investment targets that can benefit directly from rising energy prices. Gold, traditionally a safe-haven asset, has not only failed to rise but has been sold off due to liquidity pressures, highlighting the nonlinear market behavior under extreme geopolitical shocks.

However, gold has not continued to decline indefinitely. After breaking below $4,600, spot gold prices showed a technical rebound, closing on Thursday at $4,680.99, up 0.70% intraday, indicating support at certain levels.

Market Performance Comparison: Gold, Silver, and Bitcoin

During the Hormuz Strait crisis, the three major assets exhibited markedly different trends. The current market situation is summarized as follows:

• Gold: Down for seven days in a row, with a maximum intraday decline of 6%; after falling below $4,600, it rebounded to around $4,680, now at its lowest level since early February.
• Silver: Declined over 13%, pressured by expectations of weakening industrial demand and liquidity sell-offs.
• Bitcoin: Briefly surged past $75,000 before the Middle East tensions intensified, then retreated to around $69,000; since the outbreak of conflict involving Iran, Bitcoin’s overall performance has outperformed gold.

Bryan Tan, a trader at crypto market maker Wintermute, pointed out that although Bitcoin has shown greater resilience compared to gold, it lacks the momentum for further gains above $75,000. This suggests that during highly volatile news periods, investors should remain cautious, keep sufficient capital when buying on dips, and avoid blind entries.

Six Countries’ Joint Statement and Long-term Energy Outlook

In response to the blockade stalemate in the Strait of Hormuz, international diplomatic efforts are accelerating. The joint statement from the UK, France, Germany, Italy, the Netherlands, and Japan indicates that Western allies and major energy importers have prioritized ensuring the Strait’s navigability. However, the statement does not specify concrete military or non-military measures.

On the production side, QatarEnergy confirmed that facilities at Ras Laffan Industrial City—the world’s largest LNG facility accounting for 20% of global LNG supply—were severely damaged in missile attacks. Repairs are expected to take three to five years, further worsening the already tense global energy supply situation.

James Meadway, co-director of the Verdant Economic Policy Think Tank, warned in an interview that the current energy crisis is not a short-term fluctuation but involves “serious disruption” to oil and natural gas production, emphasizing that the current situation will lead to a “significant and long-term increase in energy prices.”

Frequently Asked Questions

Q: What does a 95% reduction in Hormuz Strait shipping mean?
The Strait of Hormuz is the most critical maritime energy transportation route globally, with nearly all oil and LNG exports from Saudi Arabia, Iraq, Kuwait, the UAE, and Iran passing through here. A 95% reduction means that the main pipeline for global seaborne oil is almost halted. The impact on energy markets is equivalent to a severe short-term shortage of global oil supplies, which explains the recent extreme volatility in oil and natural gas prices.

Q: Why does gold not rise but fall during geopolitical crises?
Gold’s status as a safe-haven asset usually drives prices higher amid uncertainty. However, in extreme geopolitical shocks, markets can experience a “liquidity crisis” effect—investors, urgently needing cash for margin calls or other liquidity needs, are forced to sell gold, which is otherwise considered a safe haven. This phenomenon occurred during the 2008 financial crisis and the early COVID-19 pandemic. The seven-day decline in gold partly reflects this “liquidity priority over safe-haven” market dynamic.

Q: Does Bitcoin’s performance in this crisis confirm its status as “digital gold”?
Bryan Tan from Wintermute noted that Bitcoin did outperform gold after the outbreak of conflict involving Iran, but it lacked follow-through buying above $75,000, indicating that institutions have not yet actively increased Bitcoin holdings as a war-time hedge. Bitcoin’s relative strength may more reflect its liquidity characteristics and portfolio structure rather than a market consensus that it is the preferred safe-haven asset during wartime.