Iran Nears Shipping Deal With Oman While Its Parliament Moves to Ban US and Israeli Vessels

Iran said Wednesday it is finalizing a shipping-route agreement with Oman for the Strait of Hormuz, even as its own parliament reviews a plan to permanently ban vessels linked to the United States and Israel from the same waterway. The two developments, announced within a day of each other, capture the split-screen nature of a nearly six-month war that has strangled one of the world's most important energy corridors: Tehran is negotiating access with one American ally while its legislature moves to lock out America itself.

The proposed Oman deal would let commercial vessels enter the Persian Gulf through a northern corridor near the Iranian coast and exit through a southern corridor near the Omani coast, according to Iran's Foreign Ministry. It would run for two to four months and, Iranian officials have stressed, would not amount to a full reopening of the strait. A Trump administration official flatly rejected any framework that involved fees or permissions, telling NPR that "any temporary routes will be without any impediments, meaning no approvals or permissions and no tolls or charges." Oman has not publicly confirmed the specific terms Iran has described.

A Deal With Oman, a Ban Aimed at Washington

The timing of the two announcements was not a coincidence so much as a demonstration of how Iran is trying to negotiate on two tracks at once. According to NPR, Iran's parliament is reviewing a proposal that would ban vessels linked to the United States, Israel and other countries Tehran considers hostile from transiting the strait at all, until Iran is compensated for war damage. Ships from other nations would not transit for free under that same plan: it calls for fees of up to 7% of a vessel's cargo value, with fines reaching 20% of cargo value for ships that violate Iran's conditions once they are underway.

Iranian officials have been careful to describe the Oman framework in narrower terms than a general reopening. Deputy Foreign Minister Kazem Gharibabadi said, according to Fortune, that "this understanding does not mean the full reopening" of the waterway, and Iranian state television reported separately that any final agreement remains contingent on "a change in US behavior." That conditional language leaves Iran room to walk the deal back if Washington does not soften its posture, which so far it has not: President Trump said this week that the United States effectively controls the strait already, through the naval blockade it has maintained on Iranian vessels since the spring.

Foreign Ministry spokesman Esmail Baghaei told reporters Wednesday, according to Iran's state IRNA news agency, that "if some third parties do not obstruct work in this regard, the joint statement of the two countries, including the main considerations and agreed points, is also in the final review and drafting stage." Iran and Oman have already agreed on the geographic coordinates for the route itself, Baghaei said. Whether that optimism survives contact with the parliament's ban proposal, still working through Iran's legislative process on a separate and slower track, is a question the Oman agreement itself does not answer, and one that will likely determine whether this week's diplomacy amounts to anything more than a headline.

How the Strait Was Closed in the First Place

The current negotiations trace back to February 28, when the United States and Israel launched coordinated airstrikes against Iranian military and nuclear facilities in an operation the Pentagon called Operation Epic Fury. The strikes killed Supreme Leader Ali Khamenei, and Iran retaliated within days with missile barrages against Israeli cities and U.S. bases across the Gulf region. By March 4, barely a week later, Iran's Revolutionary Guard Corps had declared the Strait of Hormuz closed, according to a timeline of the conflict maintained on Wikipedia.

The IRGC did not need a formal legal declaration to make that closure effective. Fleets of 500 to 1,000 or more small speedboats harassed commercial traffic, backed by missile and drone strikes, naval mines seeded throughout the waterway, and GPS jamming and satellite spoofing that made safe navigation unreliable even for vessels willing to risk the trip. The practical effect was to make marine insurance for any Hormuz transit prohibitively expensive, which throttled shipping without Iran ever needing to physically intercept every vessel that tried to pass.

By late March, the IRGC had specifically barred vessels from the United States, Israel and allied nations, while continuing to allow some other traffic to pass under duress. Iran later moved to formalize its control, establishing the Persian Gulf Strait Authority in May to regulate transit through the corridor. The United States responded with its own formal structure days later: the Navy launched Operation Project Freedom on May 4 to escort commercial vessels through the gulf, after Trump, who had initially dismissed military warnings that the strait could be closed at all, threatened to "destroy Iran's infrastructure" if it remained shut and floated renaming the waterway the "Strait of Trump" or the "Strait of America."

Sixty Vessels, a Sunk Tugboat and a Blockade That Held

The human and economic toll of the closure has been substantial. More than 60 merchant vessels were attacked, damaged or seized during the March and April peak of the crisis. The tugboat Mussafah 2 sank with four crew members killed, and multiple oil tankers caught fire while attempting to transit the strait despite the danger. The disruption has been described as the largest shock to world energy supply since the 1970s, with Brent crude peaking at $126 a barrel during the worst of the closure, a level that rippled through fuel and fertilizer prices well beyond the Gulf region itself.

Prices have since retreated substantially as negotiations have progressed, though not all the way back to pre-crisis levels. Brent crude traded near $79 a barrel Thursday morning, and West Texas Intermediate was around $75, according to Fortune's market reporting, after WTI had lost 11% over three trading sessions as traders priced in the prospect of a deal. That is a market pricing in genuine relief rather than resolution: the gap between the $126 peak and the current price reflects real progress, but oil well below even today's range would be needed to signal that traders expect the strait to function normally again anytime soon.

Roughly 20% of the world's total petroleum liquids consumption, about 20.9 million barrels a day as of last year, normally transits the Strait of Hormuz, according to the U.S. Energy Information Administration, which is part of why a closure lasting months, rather than days, was able to move global energy prices as sharply as it did. The 60-vessel toll and the Mussafah 2 sinking are not just casualty figures; they are the reason insurers priced Hormuz transits as effectively uninsurable for much of the spring, which did more to choke off traffic in practice than any single Iranian military tactic could have accomplished on its own.

Oman Says No Tolls. Iran Says They're Not Tolls.

Underneath this week's diplomatic language sits a dispute that predates it by weeks. In late June, Oman's Foreign Minister Badr Al-Busaidi told a Gulf Cooperation Council meeting in Bahrain that "future arrangements regarding the Strait do not entail the imposition of any transit fees," according to Arab News. Oman announced UN-coordinated, toll-free temporary shipping routes through the strait that same day, staking out a clear public position that any passage arrangement it backs will not charge ships to use it.

Iran has not adopted that position, even as it negotiates with Oman on the corridor itself. Iranian officials have instead drawn a distinction between "tolls," which Tehran says it is not charging, and "service fees" for navigation assistance and security within its territorial waters, which it insists vessels must pay. Oman has pushed for any such fee to be voluntary; Iran has insisted the opposite, that payment is not optional for ships that want safe passage through Iranian-controlled waters. The two governments are, in effect, negotiating a shared shipping corridor while disagreeing about whether using it will cost anything at all.

That gap has not stopped the two sides from working toward a joint statement, which suggests the fee dispute may be getting set aside rather than resolved, at least for the temporary route Iran and Oman are discussing now. Whether "service fees" survive in the final text, and whether Oman's public toll-free stance holds if Iran insists on collecting from vessels using the Iranian-controlled northern corridor, is exactly the kind of detail that tends to surface only after an agreement is signed rather than before.

Oman's incentive to paper over the disagreement is straightforward: it sits on the opposite shore of the strait from Iran and has spent the war positioning itself as the mediator both Tehran and Washington are willing to talk to. A public fight with Iran over terminology would undercut that role at the exact moment it is proving useful. That leaves the toll-versus-fee question as a live fault line inside the emerging deal rather than a settled point, one that could resurface the moment the temporary corridors actually open and a shipping company gets an invoice it did not expect.

Washington Rejects the Premise Entirely

The Trump administration has not engaged with Iran's fee-versus-toll distinction so much as rejected the entire framing behind it. The anonymous administration official who spoke to NPR was unambiguous: "The Strait of Hormuz is an international waterway and no party controls the lanes or the ability to transit through them." That position leaves essentially no room for any fee-for-service model, whatever Iran calls it, because it rejects the premise that Iran has standing to charge for passage through international waters in the first place.

President Trump has gone further, claiming the United States effectively controls the strait already through the naval presence it has maintained since Operation Project Freedom began in May. That is a claim about facts on the water as much as about law: American warships have been escorting commercial vessels through parts of the strait for months, which gives the administration a practical basis for arguing that Iran's proposed fee structure describes an authority Iran does not actually hold.

The disagreement is not a technicality, and it is why Iran's proposed 7% cargo-value fee and 20% violation penalty matter well beyond their percentages. Whether that structure is enforceable depends entirely on whether the international shipping industry treats Iran's claimed authority over the strait as legitimate. The Oman negotiation gives Iran a diplomatic partner that lends some legitimacy to its position; the U.S. rejection denies that legitimacy outright. Both things are true at the same time, and shipping companies are left to decide, vessel by vessel, whose version of the rules they are more afraid of violating.

That is not a hypothetical dilemma for shipowners. A vessel that pays Iran's proposed service fee to transit the northern corridor risks running afoul of a U.S. administration that says no party has the authority to collect anything at all; a vessel that refuses to pay risks the 20% cargo-value penalty Iran's parliament is drafting into law. Insurers, who spent the spring pricing Hormuz transits as effectively uninsurable, are the ones who will ultimately decide how much that risk is worth, and their premiums may end up mattering more to whether ships actually use the new corridors than anything either government signs. Neither side has signaled it is prepared to move off its position to resolve that bind.

What a Temporary Route Would and Wouldn't Fix

Even if the Oman framework is finalized exactly as described, it would not resolve the underlying conflict. A two-to-four month temporary route, restricted to specific corridors and explicitly described by Iran's own deputy foreign minister as falling short of a full reopening, functions as a pressure-relief valve rather than a settlement. It would let some commercial traffic resume under defined conditions while leaving the deeper disputes, over who controls the waterway, whether Iran can charge for transit, and whether American and Israeli-linked vessels remain barred entirely, completely unresolved.

That structure also means the deal's real-world value depends on enforcement details that have not yet been made public: which vessels qualify to use the temporary corridors, how "linked to the United States or Israel" would be defined for ships with mixed ownership or flag-of-convenience registration, and what happens to a vessel that unintentionally strays from the agreed coordinates given the GPS jamming that has plagued the strait since March. None of the reporting so far describes an enforcement mechanism more sophisticated than the same monitoring apparatus Iran built to run its unilateral closure in the first place, which relied on speedboat patrols and mine placement rather than any internationally recognized navigational authority.

The parliamentary ban proposal, moving on its own slower track, is arguably the more durable threat to any deal reached with Oman. An executive-branch agreement between Iran's Foreign Ministry and Oman can be negotiated in weeks and adjusted quietly if circumstances change. A law passed by Iran's parliament requiring war-damage compensation before U.S. and Israeli vessels are ever allowed through carries the weight of domestic Iranian politics behind it, and would be far harder for Tehran's negotiators to set aside quietly if talks with Washington eventually produce a broader settlement.

The Ceasefire That Didn't Hold, and the One Now Being Tested

Washington and Tehran have been here before this year. A tentative ceasefire, formalized through what has been called the Islamabad Memorandum on June 17, partially reopened the strait after the worst of the spring closures. That arrangement did not survive the summer: sporadic attacks resumed in July after Israeli military operations were reported to have violated the ceasefire's terms, plunging the strait back into the kind of uncertainty the current Oman negotiations are now trying to manage.

That history is the clearest reason to treat this week's announcements as an opening move rather than a resolution. The Islamabad framework also involved competing interpretations of what had actually been agreed between the parties, and it collapsed within weeks once one side concluded the other had broken faith. A temporary shipping corridor negotiated with Oman, while Iran's own parliament simultaneously drafts a law to permanently exclude American and Israeli vessels, is arguably an even more fragile foundation than the ceasefire that already failed once this summer.

For now, the practical signal markets are reading is the oil price, which has fallen from its $126 peak to the high $70s as traders price in at least the possibility of eased tensions. Whether that holds depends on questions still unanswered as of Friday: whether Oman finalizes and publicly confirms the terms Iran has described, whether Iran's parliament actually passes the ban it is reviewing, and whether either government's definition of what counts as "reopening" the strait ever converges with the other's.

What is not in dispute is the human cost of getting the answer wrong a second time. The Islamabad Memorandum's collapse in July did not just move oil futures; it put commercial crews back in a strait where naval mines, GPS spoofing and armed speedboats had already sunk one tugboat and killed four sailors months earlier. Whatever legal language ends up in the Oman agreement, the people who will find out first whether it actually holds are the crews of the next tankers sent through the corridors it creates.