Strait of Hormuz Shipping Resumes: How Does the Decline in Crude Oil Prices Lead to a Bitcoin Rebound?

On July 2, the international crude oil market continued its downward trend. WTI crude oil futures fell 2.03% to $68.09 per barrel; Brent crude oil futures fell 2.41% to $71.19 per barrel. This marks the third consecutive trading day of declining oil prices.

The direct driver of this decline comes from the rapid cooling of geopolitical tensions in the Middle East. The Strait of Hormuz—a key waterway that carries about one-fifth of the world's seaborne crude oil—is gradually resuming navigation after being closed during the conflict. On June 23, the Iranian side announced that the strait is fully open to merchant ships. According to US officials, oil flows through the Strait of Hormuz have recovered to over 10 million barrels per day. On June 29, 24 oil tankers and cargo ships passed through the strait, and shipping activity increased further on June 30.

However, the resumption of shipping does not mean an immediate return to normal supply. A large backlog of vessels need to be rerouted, ports need to resume loading and unloading operations, and energy companies need to re-coordinate export plans. Logistics company DHL stated that the full reopening of the strait does not mean the related impacts will be eliminated immediately. Nevertheless, the reopening of the strait remains a strong positive signal, helping to improve market expectations and boost supply chain confidence.

How big is the gap between the substantive progress in US-Iran negotiations and market expectations?

On July 1, the United States and Iran completed a new round of indirect talks in Doha, Qatar. The talks were mediated by Qatar and Pakistan, focusing on implementing the US-Iran Memorandum of Understanding, with core topics including unfreezing Iran's frozen assets and ensuring maritime security in the Strait of Hormuz.

However, the substantive outcomes of the talks were limited. The two sides did not achieve a breakthrough in reaching lasting peace but instead focused on issues the parties claimed were "resolved," such as the Strait of Hormuz and the unfreezing of Iranian funds. Iran's chief negotiator, Ali Bagheri Kani, confirmed that the talks had ended but did not specify whether the two sides had narrowed their differences. Qatar's Foreign Ministry stated that the talks had made "positive progress," but the next round of talks cannot be arranged until after the funeral of Iran's former Supreme Leader Khamenei.

Notably, since the signing of the memorandum, the US and Iran have not held any face-to-face talks. Core differences, such as nuclear issues, have been postponed to later stages. This means that the market's current pricing of "geopolitical risk removal" may be ahead of the actual political process. Iran has clearly stated that the "free passage" arrangement for the strait is limited to 60 days and mainly targets vessels stranded during the war, and does not imply Iran's relinquishment of its rights.

Why has the crude oil market shifted from "supply panic" to "surplus expectations"?

The sharp drop in oil prices is not only a retreat of the geopolitical risk premium but also reflects a reassessment of supply and demand fundamentals by the market. During the conflict, the peak price of Brent crude oil reached around $120 per barrel. Since the US and Iran signed a ceasefire memorandum of understanding on June 15, both major international crude oil benchmarks have fallen by more than 15%.

Investment banks such as Goldman Sachs and Morgan Stanley pointed out that even considering the demand for replenishing strategic reserves, the global crude oil market will still return to a severe supply surplus next year. Goldman Sachs expects the average daily net surplus in the crude oil market next year to be close to 2 million barrels per day. Morgan Stanley has lowered its oil price forecasts twice in just over two weeks.

This assessment is supported by data. US crude oil production and exports have hit record highs. US commercial crude oil inventories (excluding strategic reserves) have fallen for 12 consecutive weeks to their lowest level since March 2025—but this is the result of wartime consumption, not a sign of structural shortages. With exports through the Strait of Hormuz expected to normalize by the end of July, the market will enter a surplus scenario. Global demand for replenishing strategic petroleum reserves is expected to be slightly higher than 1M barrels per day, but this can only partially offset the expected surplus.

How does the decline in oil prices affect risk asset pricing through the inflation and interest rate channels?

The direction of oil prices is never just an energy story—it becomes a core variable running through asset pricing in 2026 through the inflation expectations and interest rate channels.

In May 2026, US CPI energy prices rose 3.9% month-on-month, contributing more than 60% of the overall month-on-month increase. The weight of oil prices in inflation determines that price changes in oil directly transmit to inflation expectations. After the announcement of the US-Iran agreement, the market quickly initiated a clear transmission chain: falling oil prices → cooling inflation expectations → loosening expectations for Fed rate hikes.

Previously, traders had fully priced in a 25-basis-point rate hike by the Fed in December. After the agreement announcement, the probability of that rate hike fell from near 100% to about 74%. The head of fixed income strategy at UBS Global Wealth Management pointed out that with oil prices curbed, the pressure on the Fed to raise rates this year is easing.

For the crypto market, the significance of this transmission chain is that loosening rate hike expectations imply a potential improvement in the US dollar liquidity environment. Historical experience shows that when market concerns about tightening policies ease, capital tends to shift from defensive assets to growth-oriented risk assets. Bitcoin, as a representative of high-volatility risk assets, typically shows high elasticity in this macro narrative shift.

What is the structural correlation between Bitcoin's rebound and crude oil's decline?

On July 2, Bitcoin showed a low-level rebound. According to Gate market data, BTC hit a low of 58,163 USDT before recovering to 61,324 USDT, up 2.46% in 24 hours. Bitcoin returned above the $60,000 mark.

This rebound is highly synchronous in time with the decline in crude oil prices, but the relationship between the two is not simply causal—they share the same macro driving factor: the repricing of geopolitical risk premiums.

Since the outbreak of the conflict on February 28, crude oil and Bitcoin have experienced very different pricing trajectories. When the conflict pushed oil prices up, market risk aversion rose, capital flowed to safe-haven assets, and Bitcoin faced pressure. When US-Iran peace talks made progress and the Strait of Hormuz resumed navigation, the geopolitical risk premium withdrew from commodity markets, macro liquidity expectations improved, and capital flowed back into growth-oriented risk assets.

This correlation is no longer just theoretical discussion in 2026—it has become a structural macro transmission mechanism. The pricing logic of global assets is converging, and Bitcoin's sensitivity to macro variables continues to increase. It should be noted that this correlation is neither linear nor stable. The crypto market is also influenced by multiple factors such as ETF capital flows, regulatory policies, and technical aspects.

Why did gold rise instead of fall amid the easing of geopolitical tensions?

Easing geopolitical risks usually means a decline in safe-haven demand, which theoretically should suppress gold prices. However, in this market movement, gold has defied the traditional "safe-haven seesaw" logic.

On July 2, COMEX gold rose 0.15% to $4,044.60 per ounce. Gate data showed gold prices further rising to $4,051.81 per ounce, with a daily gain of 1.33%.

Institutions generally believe that the market is shifting from a "war safe-haven" narrative to an "inflation hedge" framework. Falling oil prices have alleviated inflation pressures, but market judgments on the medium- to long-term inflation path have not fundamentally changed. Additionally, structural factors such as central banks' continued accumulation of gold and the reassessment of the US dollar credit system provide support for gold independent of geopolitical narratives.

This phenomenon has implications for understanding the pricing logic of crypto assets: like gold, Bitcoin is gaining structural narrative support that transcends single risk events—including the digital gold narrative, institutional allocation demand, and the long-term logic of an alternative to the fiat currency system. Short-term fluctuations in geopolitical premiums may not shake these deeper pricing factors.

Is the logical chain of cross-asset capital rotation complete?

The logic of capital rotation from crude oil to Bitcoin needs to be verified through multiple transmission links.

First Link: Geopolitical risks fade → improved crude oil supply expectations → oil prices decline. This link has already occurred, with WTI falling from above $85 during the conflict to $68.

Second Link: Oil prices decline → cooling inflation expectations → loosening rate hike expectations. This link is currently happening, with the probability of a Fed rate hike in December falling from near 100% to about 74%.

Third Link: Loosening rate hike expectations → improved liquidity expectations → rising risk appetite. The transmission of this link has a time lag and is subject to interference from other variables—negative factors such as continued outflows from crypto ETFs and Citi's downgrade of BTC and ETH price targets are forming a counterbalance.

Fourth Link: Rising risk appetite → capital inflows into crypto assets. Bitcoin's rebound on July 2 provides preliminary evidence of this link, but sustainability remains to be seen.

The complete logical chain of rotation is theoretically valid, but the actual transmission efficiency and magnitude are constrained by multiple factors such as market structure, investor sentiment, and the regulatory environment. The current market is in a "high positions, low volatility" consolidation phase, and trend confirmation requires more time and data.

Summary

WTI crude oil falling below $69 per barrel marks an acceleration in the removal of the Middle East geopolitical premium from the global asset pricing system. The resumption of shipping in the Strait of Hormuz and progress in US-Iran negotiations are direct triggers, but the deeper change lies in the market's reassessment of supply and demand fundamentals—a shift from "supply panic" to "surplus expectations" is reshaping the long-term pricing center of crude oil.

For the crypto market, the decline in oil prices transmits through the inflation and interest rate channels into improved liquidity expectations, providing macro narrative support for Bitcoin's rebound. BTC's recovery from 58,163 USDT to 61,324 USDT on July 2, to some extent, reflects market validation of this transmission mechanism.

However, the logical chain of cross-asset capital rotation still has uncertainties. US-Iran negotiations have not yet touched core differences such as nuclear issues, and the resumption of shipping in the Strait of Hormuz also faces practical operational obstacles. Investors need to be wary of the risk that expectations of "geopolitical risk removal" are running ahead of political reality. The time lag in macro transmission, structural factors in the crypto market itself, and the volatility of the geopolitical process could interrupt or reverse the current rotation trend.

FAQ

Q: What is the main reason for WTI crude oil falling below $69?

A: The direct reason is the resumption of shipping in the Strait of Hormuz and progress in US-Iran negotiations, which eased market concerns about disruptions in Middle East crude oil supply. The deeper reason is that the market is shifting from "supply panic" to "surplus expectations," with institutions like Goldman Sachs expecting the global crude oil market to face a net surplus of nearly 2 million barrels per day next year.

Q: How does the decline in oil prices affect the crypto market?

A: Falling oil prices → cooling inflation expectations → loosening expectations for Fed rate hikes → improved liquidity expectations → rising risk appetite. This transmission chain provides macro narrative support for risk assets like Bitcoin.

Q: Have the US and Iran reached an agreement?

A: The two sides signed a memorandum of understanding on June 18 but have not yet reached a final lasting peace agreement. The July 1 talks in Doha focused on technical details, with core differences such as nuclear issues postponed to later stages. The next round of talks will be arranged after Khamenei's funeral.

Q: Has the Strait of Hormuz fully returned to normal navigation?

A: The strait has recovered from its most tense phase, and merchant ships can pass, but full normalization still requires time. A large backlog of vessels needs to be rerouted, and ports need to resume loading and unloading operations. Iran has stated that the "free passage" arrangement is limited to 60 days.

Q: Can Bitcoin's rebound last?

A: On July 2, BTC recovered from 58,163 USDT to 61,324 USDT, reflecting improvements in the macro narrative. However, the sustainability of the rebound depends on actual progress in US-Iran negotiations, the trajectory of inflation data, and structural factors in the crypto market itself (such as ETF capital flows, etc.).