Iran, Oman reach deal on Strait of Hormuz, but reopening hinges on US conditions

Iran and Oman have reached an agreement on the division of control over the Strait of Hormuz and the revenues generated from the vital waterway, but Iran's Revolutionary Guards said on Wednesday that the strait would not be reopened unless the United States accepts the terms.

The two countries have held on-and-off negotiations for about a month over the management of traffic through the strait, a critical global energy chokepoint that handled roughly one-fifth of the world's oil and liquefied natural gas shipments before the war began in February.

Also Read: Iran and Oman discuss temporary Hormuz corridor as impasse with US drags on


Most shipping through the waterway has since been halted, pushing global energy prices higher as Tehran and Washington have sought to assert control over the channel through separate blockades.

"The Strait of Hormuz belongs to Iran and the country of Oman... We have been in negotiations with Oman for about a month, and we have reached results that are acceptable to both sides," Islamic Revolutionary Guard Corps spokesman Hossein Mohebbi said in comments published by Iranian state media.

"In these negotiations, agreements have been reached regarding the share of each country in the waters of the Strait and the share of Iran and Oman ⁠in its ‌revenues," Mohebbi added.

The IRGC accused Washington of attempting to derail the talks between Tehran and Muscat, saying US opposition had delayed implementation of the agreement.

"If the United States ⁠stops obstructing and returns to the agreement, we can open the Strait of Hormuz within the framework of the agreement reached... If the United States does not accept our conditions, the Strait of Hormuz will not be opened under any circumstances," Mohebbi said.

Attacks keep shipping risky

Although active fighting between the United States and Iran has largely eased in recent weeks, diplomatic efforts to secure a peace agreement have stalled. Continued attacks on commercial vessels have also kept passage through the Strait of Hormuz perilous.

Also Read: 'Not open tomorrow': Iran FM Gharibabadi says temporary Oman route isn't Strait of Hormuz reopening

Iran on Sunday blacklisted 45 ships, apparently targeting ship-to-ship transfers being used by Gulf energy producers to circumvent its blockade. Some companies are planning to stop using vessels included on the blacklist, according to sources.

The United States has also stepped up economic pressure on Tehran. Washington earlier this week threatened to penalise countries that continue to do business with Iran, although it said the measures would not be imposed immediately.

The latest sanctions did not target Chinese financial institutions suspected of facilitating Iranian oil exports, which have continued despite the US blockade.

Oil prices ease as diplomacy offers hope

Iran condemned the US effort to isolate its economy as an act of "gross lawlessness" and said it expected many countries to reject the pressure campaign.

Oil prices fell for a third consecutive day on Wednesday, dropping more than $2 a barrel to a two-week low as signs of renewed efforts to find a mediated end to the conflict eased some concerns over prolonged disruption to energy supplies.

The war began on February 28 with US and Israeli strikes on Iran, triggering the confrontation that has since disrupted shipping through one of the world's most important energy routes.