Over the weekend, President Trump announced that the "perimeters of a deal" on the Strait of Hormuz had been agreed to, and that he suspended planned major strikes at the request of Iran and "other Middle Eastern countries" to allow for further negotiations. This was the second weekend in a row where major strikes were called off. Reporting from Reuters suggests U.S. interceptor stockpiles are running low and could be why the escalatory strikes were called off, as the U.S. would not be in a strong position to defend its assets or allies in the region.
- Global Guardian maintains that firms should reconsider non-essential travel to the region as "escalation whiplash" remains constant.
- A resumption of Iranian strikes on infrastructure in the region is possible. This could include the targeting of airports, hotels, power plants, desalination plants, and petroleum facilities across Gulf Cooperation Council (GCC) states, especially if the U.S. does carry out a previously threatened "massive attack."
While Iran claims there are no ongoing negotiations with the U.S., they have held talks with Oman regarding the Strait of Hormuz, as some type of power-sharing and/or revenue-sharing agreement between Iran and the Gulf states is the most likely solution to reopening the Strait permanently. A New York Times article from 03 August suggests Iran and Oman are close to such an agreement, having locked the U.S. out of negotiations. It would solidify Iran's control over the Strait of Hormuz, with ships heading into the Persian Gulf transiting a channel controlled by Iran while ships leaving the Gulf would travel on a channel near Oman. A "service fee" would be charged, revenue from which would be split between Iran and Oman.
As it stands, the U.S. continues to enforce its blockade of Iranian ports and ships, having redirected 44 commercial vessels, disabled two others, and boarded two more so far. Iran says the Strait shall remain closed until the U.S. lifts its blockade, even with an agreement in place with Oman. Once the blockade is lifted and the Strait is reopened, Iran expects both countries to return to the 14-point plan laid out in the Memorandum of Understanding (MOU) signed back on 18 June. The end of the sixty-day window to negotiate on the nuclear issue among others is rapidly approaching.
At the same time, Saudi Arabia announced a new military coalition comprising 14 countries to help protect commercial shipping through the Bab al-Mandab Strait, lately under threat from Yemen's Houthis. The Iranian-backed group hit and sank an Indian vessel off the coast of Yemen on 04 August, with all crew rescued, and claimed to have struck Saudi Arabia's Najran airport in a drone strike. Saudi Arabia may have to revert to paying off the Houthis if the maritime coalition cannot successfully protect commercial shipping.
The U.S. does not have many viable options left to either deter Iran or force it to open the Strait of Hormuz, and the Trump administration is under growing domestic political and economic pressure due to rising energy prices ahead of mid-term elections in November. Likely paths forward include an interim bilateral agreement between Iran and Oman on the Strait or an extended "strategic pause" for negotiations in order to build up interceptor stockpiles followed by major strikes. Reporting from Axios late on 04 August indicates the former is likely imminent, with a deal to be announced as early as today. It would set up a 60-day temporary arrangement between Iran and Oman to keep the Strait open.
As seen with the original MOU, ceasefire, and subsequent breakdown, a return to conflict is possible if not likely, as the U.S. is not keen to allow Iran to maintain either military or economic control over the Strait of Hormuz.
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