Trump says Iran talks ‘going very well’ as Hormuz deal nears
Trump says U.S.-Iran talks are moving along nicely, with a potential 60-day Strait of Hormuz shipping framework possibly landing within days. Oil, defense, and shipping names are all in play.
President Donald Trump said talks with Iran are moving along very nicely, with a potential Strait of Hormuz shipping framework possibly landing within days. The comments continue a string of positive signals from the White House even as the Iran war grinds into its sixth month.
What Trump said
Trump told reporters in Los Angeles on Tuesday night that talks with Iran are “moving along very nicely,” adding, “We’ll know in 48 hours.”
He warned that if Iran backs out again, they will be hit very hard, and cautioned that if the Strait of Hormuz is not reopened soon, Iran will be targeted.
The Hormuz framework in focus
Axios reported that the US, Iran and Oman are preparing to announce as soon as Wednesday a 60-day agreement on shipping through the Strait of Hormuz, under which inbound vessels would use a northern lane near Iran while outbound traffic would travel through Omani waters in coordination with Iran.
Iran and Oman are close to finalizing a proposed framework for commercial shipping through the Strait of Hormuz, Tehran’s deputy foreign minister said.
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Why traders should care
Trump said he held productive all-day negotiations with Iran on Tuesday, adding the country should make a deal to reopen the Strait of Hormuz in a bid to ease oil prices, saying that with no friction oil could fall toward $2.50 a gallon.
According to AAA, the average price for regular gasoline across the U.S. currently sits at $4.08 per gallon. A functioning Hormuz corridor would take a meaningful chunk of risk premium out of crude, but any collapse in talks flips the tape the other way fast.
The risk of a repeat
Even if an agreement is reached, it might still fail to end the war or resolve Trump’s concerns about Iran’s nuclear program, and the previous US-Iran ceasefire lasted less than a month before collapsing over disagreements about control of Hormuz, raising the risk that military strikes and Iranian retaliation could resume if another agreement unravels.
Traders should expect headline whipsaw. See other geopolitical developments for context on how these ceasefires have traded.
Options market and stocks to watch
Watch for energy names to react to any Hormuz headline. XOM and CVX tend to track crude on Middle East tape, while USO is the cleanest proxy for spot oil moves.
Watch for defense names like LMT and RTX to fade on a deal and bid on any breakdown. Shippers and tanker operators such as FRO are also sensitive to Strait of Hormuz risk premiums.
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