One of the world’s most important shipping lanes is once again a bargaining chip — and the two sides aren’t close to a deal.
Iran has rejected an Omani proposal to share control of the Strait of Hormuz, a setback that further stalls fragile efforts to revive US-Iran diplomacy months into a war that has repeatedly rattled global energy markets.
How This Started
The current crisis traces back to early March 2026, when the US and Israel carried out a joint strike that killed Iran’s Supreme Leader, Ali Khamenei. His successor, Mojtaba Khamenei, vowed to keep the Strait of Hormuz — which normally carries roughly 20% of the world’s oil trade — closed in response, triggering months of on-and-off hostilities, tanker attacks, and oil price swings.
Oman’s Offer, Iran’s Rejection
Oman, backed by other Gulf states, proposed a joint-management arrangement for the strait, reportedly splitting the inbound and outbound lanes between the two countries. Iran’s Deputy Foreign Minister, Kazem Gharibabadi, rejected the split, saying it didn’t adequately protect Iran’s security interests. Tehran countered by proposing that one shipping lane run entirely through Iranian territorial waters, with part of the other lane included as well — effectively asking for oversight of both directions of traffic.
Ships Under Fire
Despite a ceasefire framework reached with the US in June, several commercial vessels have reportedly been attacked in or near the strait since then, with Iran’s Revolutionary Guard Corps linked to the incidents. Shipping traffic through the corridor remains well below pre-war levels.
What It’s Doing to Oil Markets
Brent crude has swung wildly throughout the conflict, briefly topping $100 a barrel after tanker strikes before sliding back toward the high $80s during recent lulls in fighting.
Where Talks Stand Now
Mediators say Iran’s rejection has undercut momentum toward reviving the broader US-Iran ceasefire framework, with US and UK officials reportedly working toward a wider international conference to stabilize the strait
