Iran Says It Will Reopen Strait of Hormuz if US Honors June Islamabad MOU, Agrees Route With Oman

Iran has reached an agreement with Oman on shipping routes through the Strait of Hormuz and says it will reopen the waterway if the US fulfills commitments under the Islamabad memorandum of understanding signed in June.

Anadolu Agency reported on August 28 that Iranian President Masoud Pezeshkian said Tehran and Muscat had agreed on passage routes through the strait. Iran would reopen the waterway if Washington carries out the obligations set out in the MOU, he said. The agreement has also been reported to Supreme Leader Ayatollah Ali Khamenei.

Pezeshkian said the conditions for reopening the strait include lifting US sanctions and the blockade on Iran, returning frozen assets, launching large-scale investment and ending the war in Lebanon. The terms also require the US to return to the MOU framework.

Iran's Supreme National Security Council has also effectively approved the Hormuz agreement, Pezeshkian said. Twelve of the council's 13 members voted in favor, which he described as an important result achieved through collective judgment.

The US and Iran signed the 14-point Islamabad MOU in June as part of negotiations to end the war. Under the agreement, Iran was to support the safe passage of commercial vessels for 60 days and consult with Oman on how the strait would be managed in the future. The two sides also agreed to discuss a final ceasefire plan and sanctions relief during the talks.

The MOU effectively lost force in July after the US and Iran each accused the other of violating the agreement. Iran and Oman have since continued separate talks on temporary routes for commercial shipping and on management of the strait.

Pezeshkian said some sanctions on banking and petrochemicals were eased while the MOU was in effect, and that Iran exported about 90 million barrels of crude oil during that period. Talks on returning frozen assets and a $300 billion investment plan were also under way, he added, but were halted as the war continued.

Before the war, the Strait of Hormuz handled about 20 million barrels a day of crude oil and petroleum products, making it a critical artery for global energy shipments. Restoring normal traffic through the strait could ease disruptions to crude oil and liquefied natural gas shipments from the Gulf, as well as pressure from marine insurance costs. Uncertainty over whether the US and Iran will carry out their commitments, however, may delay a full reopening.