The United States has said it could soon reach an agreement between Iran and Oman to normalize commercial shipping through the Strait of Strategically Important Hormuz.
The US administration has made significant progress in the talks between the two countries.
A U.S. official told Reuters on Friday (August 7th) that he was not named.
The official said Iran and Oman’s talks on the Strait of Hormuz had made progress and could reach an agreement quickly. He said the U.S. sanctions on Iranian ports could be lifted if the trade ships are uninterrupted.
Before the start of the war, about a fifth of the world’s oil was transported through the Strait of Hormuz. The five-month-long conflict has severely disrupted shipping on this important waterway. This has increased the pressure of volatility and inflation in the international energy market.
Uncertainty about the agreement
The Trump administration has repeatedly reported the possibility of an agreement on the Strait of Hormuz. Iran has denied direct talks with the United States. As a result, there is uncertainty about how effective and sustainable the Iran-Oman initiative will eventually be.
In addition to tensions surrounding Hormuz, international navigation is also at risk in the Red Sea and the Bab al-Mandeb Strait due to the Iranian-backed Houthi attacks in Yemen.
The United Arab Emirates (UAE), Abu Dhabi National Oil Company (ADNOC), said it had carried out fifteen ships during the Strait of Hormuz after the conflict began. One crew member was killed and 20 injured in the incident.
Market participants believe that if the shipping movement is normalized through the Strait of Hormuz, the concern of the fuel supply in the global market may be reduced slightly.