Iran's oil exports could fall by as much as two-thirds by the end of the year because of the U.S. sanctions, putting oil markets under huge strain amid supply outages elsewhere in the world. The Trump administration said it wanted Iran's oil customers to stop imports by then.
Following Trump's decision to quit the historic Iran nuclear pact on May 8, the United States vowed to reimpose sanctions lifted under the accord against Iran and inflict punishments like secondary sanctions on nations that have business links with Iran.
Last month, Iran's Supreme Leader Ayatollah Ali Khamenei backed President Hassan Rouhani's suggestion that Iran may block Gulf oil exports if its own exports are stopped.
Iran said its Islamic Revolutionary Guard Corps held a naval exercise in the Strait of Hormuz last week "within the framework of their annual training program".
US President Donald Trump announced in May Washington's withdrawal from a landmark multinational nuclear deal with Iran. They're the world's largest state sponsor of terror. Some protesters have shouted "Mullahs get lost!" and "Death to the dictator!" the semi-official Fars news agency has reported. The Iranian rial has fallen to 99,000 to the USA dollar despite a government-imposed rate of 44,000.
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US sanctions targeting Iranian trade in automobiles, gold and other key metals will be re-imposed on Monday, while sanctions targeting the country's energy and banking sector will resume November 4.
Hardship is coming to Iran.
Another expert who foresees tightening was far more outspoken in his short-term forecast: Stephen Brennock, oil analyst at PVM Oil Associates, stated in a note on Friday that "Venezuela's ticking time bomb together with the return of Iran's oil industry to the sanctions era has all the makings for a major supply shock".
The exercise was held with aim of "controlling and maintaining the security of the global waterway of the Persian Gulf and the Strait of Hormuz, and to proportionately counter any threats by the enemy", semiofficial Tasnim news agency reported.
The U.S., which withdrew from the nuclear deal in May, will re-impose some sanctions on Iran starting Monday. The US Energy Information Administration calls it "the world's most important oil transit chokepoint", with 20% of oil traded worldwide moving through the waterway, which is about 30 miles wide at its narrowest point.