Iran Rejects 60-Day MoU and Hardens Hormuz Position

Iran-U.S. Deadlock Deepens as Hormuz Remains Restricted and Tehran Threatens Offensive Shift

The U.S.-Iran crisis has moved beyond the failed 60-day diplomatic framework, with Tehran maintaining that the Strait of Hormuz will remain restricted until Washington meets a series of conditions, while President Donald Trump says no negotiations are taking place or scheduled. The disagreement now centers not only on the expired ceasefire framework but also on access to one of the world’s most important energy routes. Iran’s position has hardened, while Washington continues to reject the idea of extending the June memorandum.

Iran Links Hormuz Access to Unresolved U.S. Demands

Iranian negotiator Mohammad Baqer Qalibaf said on August 18 that the Strait of Hormuz would remain shut until the United States fulfilled conditions tied to the June interim agreement. Reuters reported that Tehran’s demands include changes involving the blockade of Iranian ports, oil sanctions, frozen Iranian assets and U.S. military pressure on Iran. The memorandum, signed on June 17, had established a 60-day period for negotiations toward a broader agreement, including issues related to Iran’s nuclear program. The framework later unraveled after disagreements over the Strait, with Trump declaring the agreement over on July 7 and Iran subsequently suspending it.

The diplomatic picture is further complicated by conflicting accounts of whether communication between Washington and Tehran is continuing. Trump said on August 18 that there were no talks with Iran and none were scheduled, while U.S. envoy Jared Kushner had indicated that contacts involving different parts of the Iranian government were continuing. Iran has also said it is not engaged in direct negotiations with Washington. The conflicting statements suggest that indirect contacts may still be possible, but there is no clearly established diplomatic process capable of producing a new agreement.

Tehran’s Offensive Warning Raises Maritime Risk

The diplomatic uncertainty has been accompanied by a harder military message from Tehran. A senior Iranian official told Reuters on August 17 that Iran would move toward a “fully offensive” military posture because efforts to negotiate a permanent end to the conflict had stalled. The official said Tehran was prepared to take what it described as timely and precise military action if diplomacy failed.

The statement did not establish that a new offensive had begun, but it increased concern around a waterway where commercial traffic is already heavily reduced.

That risk is reflected in the behavior of shipowners. Kpler data cited by Reuters showed that only six commodity vessels crossed the Strait of Hormuz on Tuesday, August 18, down from nine the previous day and below the recent 10-day average of 11. Before the war, more than 130 vessels a day were moving through the waterway. Hormuz has historically carried about one-fifth of global crude oil and liquefied natural gas shipments.

The conflicting claims from Washington and Tehran have made the commercial situation particularly difficult. Trump maintains that the strait is open, while Iran says access remains restricted until its conditions are met. For shipping companies, the uncertainty creates additional risks involving vessel safety, insurance, delays and cargo delivery.

Oman Seeks a Narrow Diplomatic Opening

A significant development in the crisis is the effort by Oman to help establish a mechanism for managing commercial traffic through Hormuz. Iranian officials said on August 17 that Tehran and Muscat had reached an understanding on the map of a proposed transit route and were working toward a joint statement.

Earlier reporting indicated that the proposed arrangement could involve Iran managing ships entering the Gulf while Oman manages traffic moving in the opposite direction. Details were still being negotiated, however, and the proposal had not amounted to a confirmed reopening of the Strait.

The initiative is important because Oman has traditionally played a mediation role in regional diplomacy. A workable transit arrangement could potentially improve commercial navigation even without an immediate comprehensive U.S.-Iran agreement.

Washington has opposed arrangements that would give Iran control over international shipping through Hormuz or allow Tehran to impose transit fees. The disagreement therefore adds another layer to the diplomatic challenge, with Oman attempting to find a practical mechanism for commercial navigation while Washington and Tehran remain divided over the broader conflict.

Oil Markets Price in a Longer Disruption

Energy markets are reflecting the possibility that the confrontation could continue. Brent crude closed at around $91 a barrel on August 18, while U.S. West Texas Intermediate settled near $85 a barrel. Prices remained elevated on August 19 as traders continued to assess the risk surrounding Hormuz and the possibility of prolonged disruption.

The market effect is broader than the benchmark price of crude. Prolonged disruption can increase war-risk insurance, tanker costs, delivery times and the expense of arranging alternative routes or ship-to-ship transfers. Those additional costs can eventually affect fuel prices, transportation and industrial supply chains.

The importance of Hormuz therefore lies not only in the volume of energy normally passing through it, but also in how difficult and expensive it can become to replace the route when shipping confidence deteriorates.

What to Watch Next

For now, the crisis has not produced a complete halt to maritime movement, but the persistent weakness in traffic shows that commercial operators are still unwilling to treat the Strait as a normal shipping route.

The key signals to watch are whether the Iran-Oman initiative produces a workable transit arrangement, whether Washington and Tehran establish a credible negotiating channel, and whether vessel traffic begins to recover consistently.

Without progress on one of those fronts, the Hormuz dispute is likely to remain both a military flashpoint and a continuing source of pressure on global energy and shipping markets

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