10 Days That Reshaped the Oil Market
Every oil price threshold on Polymarket — “Will crude oil hit $X by end of March?” — is effectively a binary option on a price level. Stack them together and you get something remarkable: a real-time, crowd-sourced probability distribution for oil prices, updated continuously by traders putting real money at risk. Here's how that distribution changed through each major event of the Iran war.
The Probability Curve: Five Snapshots
Each bar below shows the market's probability that crude oil will hit the given price threshold by end of March. Watch how the entire distribution shifts in response to events — not just one threshold, but the shape of the curve itself.
The shape tells the story. On March 9 (peak fear), the curve was nearly flat from $100 to $120 — traders saw little difference between oil hitting $100 vs $120. By March 17, the curve drops steeply after $110, meaning the market has priced out the extreme scenarios while keeping moderate upside risk intact.
$100 Oil: The Roller Coaster
The $100/bbl threshold market ($7.2M volume) is the single best barometer of the war premium. It traded through a 52-percentage-point range in 10 days — from a low of 47% to a high of 99%. Each major news event is visible as a distinct move in the daily data.
March 8–9: Hormuz disruption fears peak. The market opens at 78% and rips to 99% intraday on March 9. This corresponds to the first wave of ship attacks and Iran's formal closure declaration spreading on X via OSINT accounts and Iranian officials.
March 10: The crash. Despite Iran striking Israel (confirming escalation), oil probability drops from 80% to 47%. Why? The market may be repricing the duration of disruption — the immediate panic subsided and traders reassessed whether the Hormuz closure would be sustained or resolved quickly.
March 12: The biggest single-day move: +19pp. Trump's 30-day Russia sanctions waiver was announced, but instead of calming oil markets (alternative supply!), it confirmed the severity of the supply crisis. If the US is waiving Russia sanctions, the disruption must be serious. Traders bid the $100 threshold back to 85%.
March 16–17: The latest selloff. As Iran begins allowing Indian, Chinese, and Pakistani tankers through (selective safe passage), the market falls from 89% to 76%. The partial reopening signals the disruption may be more political than total.
Zooming In: Two Key Moments, Tick by Tick
Our price history captures readings as frequent as every 5 minutes during high-activity periods. Two moments stand out when you zoom all the way in — the March 9 Hormuz panic spike and the March 16 selective passage selloff. Here's what the raw data looks like.
The Hormuz Panic: March 8–9 Overnight
Between midnight and 8:30am UTC on March 9, OSINT accounts on X began sharing videos of ship attacks and amplifying Iran's formal closure declaration. Watch $120 oil and $150 oil reprice in real time.
The overnight spike is textbook X-driven price discovery. Between 4am and 8:30am UTC, OSINT accounts broke video of ship attacks and amplified Iranian FM statements. $120 oil surged 31 percentage points in under 5 hours. But the reversal was just as sharp — once the market digested the news and concluded the closure was selective rather than total, $120 gave back almost the entire move by end of day. $150 peaked at 37% and never came close again.
The Selective Passage Selloff: March 16 Overnight
Between 2am and 6am UTC on March 16, news broke that Iran was letting Chinese, Indian, and Pakistani tankers through Hormuz. Our data for $110 oil captures this with readings every 2–15 minutes.
You can see the exact moment the news hit. At 2:30am, $110 oil was at 71% — still reflecting a world where Hormuz was fully closed. By 3:02am it dropped 4pp; by 4:37am another 6pp. The initial break (71% → 60%) took roughly two hours. Then a brief bounce at 6:44am (traders testing support) before the selloff continued into the afternoon. The final reading of 59% represents an 12pp repricing of supply disruption risk — driven entirely by Iran's diplomatic decision to let select tankers through.
$110 & $120: Where the Real Uncertainty Lives
If $100 oil is the consensus expectation (currently 78%), then $110 and $120 are where the market disagrees with itself. $110 is a perfect coin flip at 50%. $120 has ranged from 21% to 84% — a 63-percentage-point swing that represents genuine uncertainty about whether this conflict produces a lasting supply shock or a temporary disruption.
The pattern in both markets is identical: spike March 8–9, crash March 10, recover March 12 (Russia waiver), spike again March 14, then steady decline through March 16–17 as selective passage news arrives. The amplitude increases with the threshold — $120 swings harder than $110, which swings harder than $100. This is exactly what options theory predicts: out-of-the-money bets are more sensitive to volatility.
Tail Risk: $150 and $200 Oil
The extreme tail tells a reassuring story. $150 oil started at 15%, briefly hit 37% on March 9 (the Hormuz panic peak), and has steadily declined to 7%. $200 oil never exceeded 9% and is now at 1%. Traders briefly feared catastrophic supply destruction but have largely concluded it won't happen.
What killed the $150+ scenario? Three things: (1) Iran's selective passage policy signals they don't want to fully cut off global oil — just punish adversaries; (2) the Russia sanctions waiver provides alternative supply; (3) no strikes on major oil infrastructure like Kharg Island (which handles 90% of Iran's oil exports). The Kharg Island market sits at 26% — still meaningful, but down from its highs.
The Other Side: Can Oil Fall Back?
The “LOW” threshold markets reveal the downside picture. “Oil drops below $80” started at 59% on March 10 (after the initial panic faded and traders thought disruption might be short-lived) and has fallen to 19%. “Below $75” went from 44% to 14%.
The steady downtrend in these LOW contracts means the market is increasingly confident oil stays elevated. Even with selective passage and the Russia waiver, the war premium is being priced as durable, not transient. The floor is rising.
Hormuz: Closed, But For Whom?
The Strait of Hormuz closure market locked at 100% by March 10 and hasn't budged. But the more interesting question is the nature of the closure. Iran's policy of selective passage — blocking US/Israeli allies while allowing Chinese, Indian, and Pakistani tankers — creates a two-tier shipping regime that's unprecedented in modern oil markets.
The US naval escort market (28%) is telling — traders are uncertain whether the US will attempt to force passage for commercial ships. Trump has publicly pushed allies for a joint naval mission, but India and Australia have declined. If a US escort does happen, expect the $100+ oil thresholds to reprice sharply.
The Time Premium: March vs. June
Comparing March expiry markets to June expiry markets reveals how traders think about the duration of the supply disruption.
| Threshold | By March 31 | By June 30 | Gap |
|---|---|---|---|
| $100/bbl | 78% | 88% | +10pp |
| $150/bbl | 7% | 32% | +25pp |
| $200/bbl | 1% | 11% | +10pp |
The gap is modest at $100 (+10pp for three extra months) but enormous at the extremes: $150 oil by March is 7% vs. 32% by June. $200 oil is 1% vs 11%. The market is saying: the tail risk isn't dead, it's just slower than the initial panic assumed. If the war drags on and selective passage breaks down, $150 oil is still very much on the table.
What the Probability Curve Says Now
As of March 17, the oil probability curve tells a story of moderate confidence in elevated prices with diminishing tail risk:
- $100/bbl is the expected floor. At 78% probability, the market sees oil touching (or already having touched) $100 as near-certain. With crude currently around $95, this implies a continued war premium.
- $110 is the coin flip. At exactly 50%, this is where the market is most uncertain. The outcome depends on whether Hormuz selective passage holds or breaks down, and whether additional infrastructure (Kharg Island) gets targeted.
- $120+ is increasingly unlikely. Down from 84% to 28%, $120 oil requires a supply shock beyond what's currently happening. The Russia waiver and selective passage have been sufficient to prevent it — so far.
- Catastrophic oil ($150+) is effectively priced out for March. But the June markets keep 32% probability on $150 — this is not over.
- Oil isn't coming back down quickly. The “below $80” and “below $75” markets are at 19% and 14% respectively and falling. The war premium is sticky.
What to Watch Next
Kharg Island (26%): If US/Israel strikes hit this terminal (90% of Iran's exports), every oil threshold reprices upward instantly. This is the single highest-leverage event for oil markets.
US Naval Escort (28%): A forced passage through Hormuz would be a major escalation. If it happens, expect the $120 threshold to spike back toward its March 9 highs.
Selective Passage Breakdown: If Iran revokes passage for Indian/Chinese tankers, the supply picture deteriorates sharply. Watch the $110 coin flip for the first signal.
Russia Waiver Expiry (~April 12): The 30-day waiver clock is ticking. If not renewed, alternative supply dries up and the June markets reprice higher.
Methodology & Data
This analysis uses hourly price history data from 7 crude oil threshold markets on Polymarket plus 3 Hormuz-related markets. Price data spans March 7–17, 2026 (PredictMarketCap tracking window). Daily OHLC (open/high/low/close) values are computed from hourly price averages. “Probability” equals the YES token price on Polymarket, where $1.00 = 100% probability. Volume figures are all-time totals per contract. War timeline events sourced from Reuters, NYT, ISW, and CRS reporting, cross-referenced with X/OSINT accounts that broke developments first. All data is from real-money prediction markets, not editorial predictions.
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