Oil prices rise as Iran says US must meet conditions before Strait of Hormuz reopens
Brent crude edged higher after Iran indicated that an agreement with Oman would not immediately reopen the Strait of Hormuz unless the United States fulfills a list of demands, while maritime traffic through the waterway remains low.
Oil benchmarks rose modestly on Monday, with Brent crude up 0.6% to $84.03 a barrel and U.S. West Texas Intermediate gaining 0.4% to $78.49. The increase follows Iran’s statement that a pending arrangement with Oman to manage navigation through the Strait of Hormuz will not lead to an immediate reopening unless the United States satisfies a set of conditions.
Iran’s senior security official Mohammad Bagher Zolghadr outlined six demands, including an end to the U.S. naval blockade of Iranian ports, withdrawal of U.S. forces from the region, a permanent cessation of hostilities, lifting of sanctions, release of frozen Iranian assets, and compensation for war-related damage. The list mirrors points raised in a June memorandum of understanding between Tehran and Washington, but Tehran has emphasized that these measures are prerequisites for fully restoring traffic.
Maritime intelligence firm Kpler reported that vessel movements through the strait fell from 15 crossings on Friday to six on Sunday, with roughly half using the Iranian-approved northern route. Traffic through the Bab al-Mandeb Strait, a parallel Red Sea corridor, remained much higher, recording 116 crossings over the same three-day period.
The strait, which carries about one-fifth of global crude oil and liquefied natural gas shipments, has been effectively closed since late February. Analysts warn that oil and gas prices are likely to stay elevated until the waterway is reliably open.
"We are in the final stages, and the old routes that existed will be replaced with new routes," Foreign Minister Abbas Araghchi said, indicating ongoing negotiations with Oman.
"Negotiations are proceeding very smoothly and constructively," spokesperson Esmaeil Baghaei added.
The United States has maintained a naval blockade of Iranian ports and imposed sanctions that have halted oil loading at Iran’s Kharg terminals. President Donald Trump has reiterated that the blockade is intended to increase economic pressure on Tehran.
Meanwhile, the Saudi-backed coalition in Yemen reported renewed Houthi attacks on Saudi facilities, including a strike on the Jazan refinery, adding further uncertainty to regional energy supplies.