Iran, Oman Negotiate Hormuz Accord

Iran and Oman are still negotiating an agreement over the Strait of Hormuz, a senior Iranian source said on Wednesday, Aug. 26, after the Revolutionary Guards claimed the two countries had agreed on how to share the waterway and its revenues. The talks continue, and no final accord has been reached, the source added.

Negotiation Status

The senior Iranian source told reporters that an agreement with Oman over the Strait of Hormuz has not been finalised. The source said the discussions were still ongoing on the details of an accord. A spokesperson for Iran's Islamic Revolutionary Guard Corps (IRGC) echoed Tehran's stance, saying that Iran and Oman had reached an agreement on their shares of the territory and revenues. The IRGC spokesperson, Hossein Mohebbi, said, “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.” He added that the negotiations had produced agreements on the share of each country in the waters of the Strait and the share of Iran and Oman in its revenues.

The exact stage of the negotiations was not clarified. Iran had earlier this month said a deal on the strait was close. Following talks on Tuesday, Omani Foreign Minister Badr Albusaidi said he was hopeful that a temporary corridor for the Strait of Hormuz and practical arrangements to restore safe navigation would soon be announced.

U.S. Conditions and Blockade

The IRGC accused the United States of obstructing Iran's negotiations with Oman, claiming that U.S. Interference had delayed the agreement. Mohebbi said, “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.” The conditions include an end to the U.S. Blockade on Iranian ports, compensation and removal of sanctions.

The U.S. Has threatened to punish countries that continue to do business with Iran, but said it would not impose penalties immediately. The sanctions did not target Chinese financial institutions suspected of facilitating oil exports from Iran.

Shipping Disruptions

Most shipping through the Strait of Hormuz has been disrupted, driving global energy prices higher. Iran announced a blacklist on Sunday of 45 ships in an effort to stop ship-to-ship transfers used by Gulf energy producers to evade the Iranian blockade. Some companies plan to stop using vessels added to the blacklist. The U.S. And Israel have degraded much of Iran's conventional military capacity, while the exact state of its nuclear program remains unknown.

Oil prices fell for a third day, dropping more than 1.5 per cent, after signs of renewed efforts to seek a mediated end to the war that began on Feb. 28 with U.S. And Israeli strikes on Iran. For more on shipping data, see stats.

Diplomatic Context

U.S. Secretary of State Marco Rubio told allies that the U.S. Did not expect to launch new strikes against Iran for now, and would instead focus on other means of pressure. U.S. Public approval of the war has fallen to its lowest level since the conflict's early days, and President Trump’s popularity is likewise at a record low ahead of congressional elections in November, according to Reuters/Ipsos polling. For related events, check fixtures.

The conflict has caused thousands of deaths, most in Iran and Lebanon, while the U.S. And Israel have degraded much of Iran's conventional military capacity. The exact state of Iran’s nuclear program remains unknown.