The United States, Iran, and Oman are reportedly close to an interim agreement to reopen the Strait of Hormuz, a critical trade route that has been closed since the outbreak of the US-Iran war. The deal would give Iran greater control over traffic in the strait, a concession it did not have before the conflict.
Interim deal details
According to Axios, citing two regional sources and a US official, the potential agreement would meet some of Iran's demands for greater control over traffic in the Strait of Hormuz. It would establish a 60-day temporary arrangement between Oman and Iran, which could be extended.
The deal would involve all inbound traffic through the strait and into the Gulf using a northern lane through Iranian waters, while all outbound traffic would use a southern lane through Omani waters, in coordination with Iran. No tolls or fees would be charged during the 60-day period.
Naval mines and permanent arrangement
The parties would also work on clearing naval mines from the median lane of the strait within 30 days. Once cleared, that lane would be used for both inbound and outbound traffic under the terms of a permanent arrangement to be negotiated between Oman and Iran.
Impact on global oil trade
About 20% of all global oil traded passed through the waterway prior to the conflict. The closure has throttled the movement of oil out of the resource-rich Middle East, causing volatility in global markets and spikes in fuel prices worldwide.
Background and Trump's stance
The US and Iran signed a Memorandum of Understanding on June 17 to bring the war to a close within 60 days, but conflict resumed less than one month after the agreement was signed. The war sparked on February 28 after the US and Israel carried out joint strikes on several key Iranian sites, prompting Iran to retaliate by striking sites across the Middle East and closing the strait.
US President Donald Trump has not followed through on threats of a massive bombing campaign, apparently to allow more time for diplomacy. However, he could green-light major strikes if a deal is not reached soon. Speaking to Fox News, Mr Trump said: "The Strait is going to be open very soon - or they're gonna hit very hard, and then the Strait is going to be open."
