Iran Signals Willingness to Reopen Strait of Hormuz as Deal Nears

Iran has reportedly signaled it is willing to reopen the Strait of Hormuz, with U.S., Iranian and Omani officials closing in on an interim agreement that could reset the five-month conflict. The U.S., Iran and Oman are closing in on an interim agreement to reopen the Strait of Hormuz, with the U.S. aiming for a Wednesday announcement, according to two regional sources and a U.S. official.

What is on the table

The emerging agreement calls for ships to enter the Persian Gulf through an Iranian-controlled route and exit through a route controlled by Oman, two regional officials told The Associated Press. Service fees would be charged for providing security and preserving the maritime environment.

Any deal, though, appears contingent on the United States lifting its blockade on Iran’s ports. The Trump administration has previously ruled out any deal that would give Iran control over the strait.

Market reaction

The Trump administration’s latest signals of a forthcoming deal drove oil prices sharply lower and sent stocks soaring to record levels as investors anticipated a breakthrough in the five-month war.

In other remarks Tuesday night, Trump once again threatened that Iran will “get hit really hard” if the purported talks fall through. Traders should treat headline risk as two-sided into any announcement.

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Why the strait matters

The Strait of Hormuz is the crucial waterway at the mouth of the Persian Gulf through which a fifth of the world’s oil and natural gas passed before the war. It has been effectively shut by Iran’s attacks on shipping since the start of the war in February.

The two sides reached an interim agreement in June to reopen the strait and launch 60 days of talks aimed at ending the war and resolving the longstanding dispute over Iran’s nuclear program. That agreement collapsed over escalating hostilities focused on the strait, and the deadline is around two weeks away.

Where U.S. officials stand

U.S. Secretary of State Marco Rubio acknowledged that negotiations have advanced. “There’s been progress made in those talks, but not finality yet. We’re hoping that will happen very shortly,” Rubio told reporters at the State Department.

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Options market and stocks to watch

Watch for oil-linked names to remain reactive to every headline out of the talks. A confirmed reopening would likely pressure crude, while a collapse in talks reverses that setup.

• USO: crude oil ETF, a direct read on any oil supply relief if the strait reopens.
• XOM: integrated major with global crude exposure; watch for how lower oil feeds into upstream sentiment.
• CVX: another major exposed to shifts in the crude tape and Middle East risk premium.
• SPY: broad market has already rallied on de-escalation hopes; watch for headline whipsaw.
• OIH: oilfield services ETF, sensitive to crude direction and capex sentiment.

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