Qatar, US signal progress on Hormuz-focused Iran deal

WASHINGTON — The prospect of an interim deal focused on the Strait of Hormuz appeared to be gaining traction on Tuesday, with Qatar saying a proposal had been drafted and both American and Iranian officials sounding hopeful about an agreement to reopen the crucial waterway.

President Donald Trump discussed efforts to deescalate U.S.-Iran tensions with Qatar’s Emir Sheikh Tamim Bin Hamad Al-Thani in a call on Tuesday, according to the Gulf state’s government. A White House official confirmed the call, but didn’t offer additional details.

Oil reversed earlier gains, and U.S. government bonds rallied, on optimism that mediators will be able to broker a deal and avoid a new wave of American airstrikes. Brent crude plunged for the second straight day on the increased likelihood that the vital Strait of Hormuz may see flows pick up again. Prices ended the session down more than 5%, settling below $80 a barrel for the first time in more than three weeks.

A short-term deal could help normalize commercial shipping in the strait — a crucial conduit for global energy supplies — and prevent the resumption of fighting in the Middle East. But even if such an agreement is reached, it might still fail to end the war conclusively or resolve Trump’s concerns about Iran’s nuclear program.

The previous ceasefire pact between the U.S. and Iran lasted less than a month before it collapsed over disagrements over control of Hormuz, raising the prospect that U.S. military strikes and Iranian retaliation could begin anew if any new agreement unravels.

In a potential climbdown that could form part of a potential deal, Iran is considering allowing European nations to remove mines from the Strait of Hormuz, according to diplomats familiar with the matter, who spoke on condition of anonymity to discuss sensitive information.

That is contrary to Iran’s public stance, but in private meetings in recent weeks Tehran has softened its position. Iran’s foreign ministry didn’t immediately respond to a request for comment.

Both U.S. Secretary of State Marco Rubio and Treasury Secretary Scott Bessent separately gave optimistic assessments of the talks regarding Hormuz.

“I think the immediate deal, the one that you see a lot of focus on, is the straits,” Rubio told reporters, of ongoing efforts to get more ships moving through the key waterway. “Suffice it to say, there’s been progress made in those talk, but not finality yet. We’re hoping that will happen very shortly.”

Bessent also suggested a deal on the chokepoint could come soon.

“We’re in talks with the Iranians and I think there is a chance we may have a deal today or tomorrow to open the strait,” Bessent said to CNBC on Tuesday. Asked whether there would be a toll on maritime traffic, he added: “I think it would be freedom of movement.”

Bessent’s comments came after the foreign ministry of Qatar, one of the main mediators between Washington and Tehran, said a proposed de-escalation resolution was “being circulated between the parties.”

Iran’s state-run IRIB News cited the country’s Foreign Ministry spokesman Esmail Baghaei as saying the talks between Iran and Oman had been positive. He said ongoing discussions were focused on “defining safe outbound and inbound routes for vessels.”

But both Qatar and U.S. officials have cautioned there’s no agreement yet. Throughout the conflict, U.S. officials have repeatedly said a deal to open Hormuz was close, with nothing materializing.

A Qatari spokesman said he couldn’t provide a timeline for a pact and that the focus is on finding a short-term resolution to avoid a further confrontation. It’s unclear if Qatar was referring to negotiations between Iran and Oman to get more ships sailing through the Strait of Hormuz.

Tensions have ramped up in recent days, with Trump saying he was giving Iran a final chance to reach a deal. Over the weekend, he held off on attacks that he said would have been the largest since World War II.

“I want to give them every last chance before decapitation,” Trump told reporters on Monday. “You’ll find out today or tomorrow. I mean, they’re going to go quickly, one way or the other. It’s not very complex.”

A potential diplomatic resolution appears to hinge on the talks between Oman and Iran. Iran continues to take a hard line. The country insists it has the right to manage maritime traffic and stop vessels that try to sail through the chokepoint without its permission.

Iran’s stance underscores the difficulty Trump has faced in wrapping up a war he started in late February. The conflict has sent energy prices soaring, hurting the U.S. leader and his Republican Party ahead of midterm elections in November.

The Islamic Republic has vowed to retaliate fiercely against any big U.S.-Israeli strikes. Throughout the conflict, it has caused significant damage to Gulf Arab states such as Kuwait, Bahrain, Saudi Arabia and the United Arab Emirates with one-way attack drones and ballistic missiles.

Trump has regularly backed down from threats to launch massive attacks on Iran. If he opts for them this time, that would likely push out oil prices further.

A senior Iranian official called on the U.S. to “take the first step and change its behavior” by returning to the terms of an interim peace deal the sides reached in June.

Bloomberg reported last week that Oman and Iran were discussing reopening the so-called middle passage through Hormuz. It has, however, been mined by Iran, according to people familiar with the matter, and may have to be cleared before vessels use it on a regular basis.

The strait, a vital conduit for supplies of oil, liquefied natural gas and other commodities such as fertilizers, remains all but shut. Hardly any ships are sailing through, at least with their transponders turned on. Most that do are going on a northern route close to Iran’s shores with Iranian permission, or on a southern one nearby Omani territory.

—With assistance from Devika Krishna Kumar, Patrick Sykes, Ellen Milligan, Samy Adghirni, Skylar Woodhouse and Sherif Tarek.