Oil markets eased on Thursday as U.S. officials indicated vessel traffic through the Strait of Hormuz was returning to levels observed before strikes on Iran disrupted shipments in late February. The development came as Washington’s top diplomat completed a Gulf tour intended to shore up confidence in a preliminary agreement with Tehran.
Traffic recovery and official assessments
U.S. Energy Secretary Chris Wright said on Wednesday that shipments through the strait were approaching the volumes seen prior to the U.S. and Israel launching strikes on Iran on February 28. Wright reported that at least 20 million barrels had exited the strait in the previous 24 hours.
During the conflict, Iran established effective control over the narrow channel, disrupting flows of oil and liquefied natural gas and unsettling global energy markets and the wider economy. The recent rebound in traffic has coincided with diplomatic efforts by the United States to calm Gulf allies uneasy about the terms of a preliminary deal with Tehran.
Tehran’s continued assertions of control
Despite the restoration of near-normal transit volumes, Iran signalled it will continue to assert authority over the strait. On Thursday, Iran’s Revolutionary Guards warned vessels to adhere to routes through the strait that Tehran has designated, rejecting newly announced shipping routes not coordinated with Iran as unacceptable and dangerous.
The warning followed an announcement by Oman that it had set up temporary shipping lanes through the strait in coordination with the United Nations’ shipping agency.
Data from the U.N.’s International Maritime Organization (IMO) showed that 57 ships carrying about 1,100 seafarers have transited the strait since June 23 under an evacuation plan.
U.S. diplomatic efforts to reassure Gulf partners
U.S. Secretary of State Marco Rubio visited Gulf capitals to reassure allies concerned about Washington’s preliminary framework with Tehran. Speaking in Bahrain, host to the U.S. Navy’s Fifth Fleet, Rubio emphasized that the United States was pursuing a lasting peace that would not compromise regional security or prosperity.
Rubio told Gulf Arab foreign ministers: "The reality of it is that no country on Earth has the right to charge for the use of international waterways. And that will never be an acceptable condition of any deal." His comments addressed worries that Tehran could seek to impose fees on vessels transiting the strait, which before the war carried roughly one-fifth of global oil and liquefied natural gas flows.
Oman’s foreign minister, Badr bin Hamad Al Busaid, who represents the country lying across the strait from Iran, told the meeting that future shipping arrangements should not include tolls.
Domestic U.S. political tensions
The diplomatic push unfolds against growing domestic criticism of U.S. policy toward the Iran war. President Donald Trump faced pointed Republican criticism at home. In a closed-door session with fellow Republicans on Wednesday, Trump reportedly clashed with Senator Bill Cassidy shortly before the administration asked Congress for tens of billions of dollars to fund the conflict.
Several Republicans who attended said Trump engaged in a shouting match with Cassidy. Cassidy told reporters: "It does not appear, although I don’t know for sure, that the course of this is going the way that we were told." The exchange occurred just before the White House formally sought significant war-related funding from Congress.
In a move seen as supportive of the administration, Senate Republican leaders scheduled a late-night vote to block a resolution that sought to end hostilities with Iran. The Senate voted 50 to 47 to stop the war powers measure, which had earlier advanced procedurally in May.
Trump reacted on social media after Wednesday’s vote, saying: "This vote puts Iran on notice," although the vote does not alter the previous procedural outcome.
Political and public sentiment pressures
The war’s toll is weighing on Trump politically ahead of November elections that will determine control of Congress. Public sentiment reflects skepticism: a Reuters/Ipsos poll found that only one in four Americans believes the war was worth its costs.
Conflicting accounts have emerged over elements of the framework deal, fuelling criticism both domestically and among foreign partners. Disagreements persist over the extent of financial incentives to Iran, the scope of nuclear inspections, control of the Strait of Hormuz and Israel’s concurrent military campaign in Lebanon.
The accord establishes a 60-day window of talks to address these thornier issues, including Iran’s nuclear programme.
Regional skepticism and concerns
The preliminary deal has prompted scepticism across the Middle East, where a number of states were attacked by Iran during the conflict and view the terms as overly favorable to Tehran. Key elements of criticism include a proposed $300 billion reconstruction fund and the easing of certain sanctions, both seen by regional partners as potentially enabling Iran to rebuild capabilities.
Critics note the accord does not tackle Tehran’s ballistic missile capacity. Under the agreement, Iran is required to allow shipping to transit the Strait of Hormuz freely for 60 days, but Tehran has indicated it might impose tolls after that period.
A diplomat briefed on the talks said Iran could propose environmental, navigation and security fees in forthcoming negotiations with Gulf states. Washington and its Gulf partners oppose the idea of such charges.
Israel and Lebanon discussions in Washington
In Washington, officials from Lebanon and Israel met on Wednesday to discuss a U.S.-backed proposal for Israeli forces to withdraw from areas of southern Lebanon they had entered during the conflict.
On Thursday, senior Israeli and Lebanese officials denied reports of any Israeli withdrawal from occupied southern Lebanon following comments from a U.S. official that Israel had pulled back some troops as a good faith gesture. Israel has been fighting Hezbollah in Lebanon since the militant group attacked Israel on March 2 in support of Iran. Tehran has made a cessation of hostilities in Lebanon central to its demands in any durable peace agreement with the United States.
Outlook
Markets have responded to signs of renewed transit through the Strait of Hormuz, yet political divisions in Washington and scepticism among regional partners leave significant uncertainty about the long-term stability of shipping through this critical chokepoint and the broader prospects for a negotiated settlement with Iran. The coming 60 days of negotiations will test whether the preliminary framework can address core security and financial concerns held by Gulf states and other stakeholders.