Iran and Oman have agreed on a new temporary shipping route through the Strait of Hormuz, offering a narrow path through a chokepoint that carried one-fifth of global oil and liquefied natural gas shipments before war shut it down in February.
The announcement came on Tuesday from Kazem Gharibabadi, Iran’s deputy foreign minister for legal and international affairs, after talks in Tehran between Iranian Foreign Minister Abbas Araghchi and Omani counterpart Badr Albusaidi. The two diplomats met to finalize details of a phased framework for managing the strait. Gharibabadi said the route’s entry would run through Iranian territorial waters, with part of the exit also passing through them. The corridor would be seven miles wide. “The agreed-upon transit route with Oman is a temporary route,” he said on state television.
The deal matters because it signals a potential easing of a crisis that has paralyzed one of the world’s most critical energy corridors. But Gharibabadi insisted the waterway will not reopen until the United States fulfills its commitments under an interim peace deal signed in June, including sanctions relief and the release of frozen Iranian assets. The strait remains closed.
A fragile corridor
The Strait of Hormuz became a flashpoint after Tehran closed the waterway in response to the US-Israel war that began in February. Iran then announced a new shipping route through its territorial waters, bypassing the internationally recognized Traffic Separation Scheme adopted by the International Maritime Organization in 1968, and said that route had been mined. In June, when Iran and the US signed a Memorandum of Understanding to end the war, Oman and the IMO announced a new transit corridor backed by the US that hugged the Omani coast. Iran said the so-called southern route violated the MoU and launched attacks on ships using it, causing the interim deal to collapse.
Passage through the strait remains dangerous. An oil tanker was disabled by an unidentified projectile on Tuesday near Oman’s Ash Shishah, close to the strait’s entrance, according to the United Kingdom’s maritime trade watchdog. Just five commodity vessels transited the strait on Tuesday, below the 10-day average of 15, according to preliminary data from Kpler.
Gharibabadi dismissed a claim by US President Donald Trump that all mines had been cleared from the strait’s international waters, calling it “only aimed at calming the markets.” He warned that US mine-detection vessels would become “very good targets” if they entered the area.
Sanctions replace missiles
The diplomatic movement coincides with a shift in Washington’s approach. Trump announced last week the “most crushing economic operation ever” against Iran, threatening sanctions against any country that does business with it. Treasury Secretary Scott Bessent pledged on Monday to launch an “economic D-day” on the Iranian regime, targeting Tehran’s “enablers” and trading partners with a list of 60 individuals, entities, and vessels. The US has started returning diplomats to Gulf states, suggesting Washington does not currently expect military escalation.
However, the US has so far held off on imposing significant secondary sanctions on other nations, including Chinese financial firms suspected of facilitating Iran’s oil trade. “Why would I want to blow up the global financial system? We believe that it is important to level set and give people a cure period, but they should know that that will move very quickly and that we are serious,” Bessent said on Monday.
China, which buys around 90% of Iran’s oil, threatened retaliation if the US expands economic pressure on nations trading with Tehran. A Chinese foreign ministry spokesperson said Beijing “will take all necessary measures to firmly safeguard its rights and interests.”
Gharibabadi urged countries to resist US pressure. “We are urging countries not to succumb to American pressure regarding the sanctions that Washington wants to impose on us,” he said, adding that Washington was mistaken about its ability to enforce sanctions against Iran’s neighbours. He said an earlier US sanctions campaign under Trump had failed, and predicted new measures would meet the same fate. “The new American sanctions are doomed to failure, and we have our own methods to counter them,” he said.
Oil prices extended recent losses on the news. Brent crude fell below $90 per barrel overnight and later declined 2.08% to $86.74 a barrel. US West Texas Intermediate futures dropped 2.37% to $80.41. Dan Coatsworth, head of markets at AJ Bell, said US sanctions on Iran were less severe than anticipated, and that lower oil prices helped markets regain some poise. Paolo Broccardo, BankPro’s chief executive officer, said the shift away from military action reduced the perceived risk to Gulf supply, even though the US did not rule out other interventions.
Technical talks are planned to develop a long-term arrangement, including mechanisms for information sharing and navigational and security services, according to the joint statement. Albusaidi said on social media that he hoped the countries would soon announce the corridor, adding that future management of the strait and a permanent solution will follow in due course. Russia’s RIA Novosti reported that the US and Iran would announce a new ceasefire agreement in the coming days, citing Iranian and Pakistani sources, but the report could not be independently verified and the White House did not respond to a request for comment.