The Strait of Hormuz is set to reopen under a deal between the US and Iran that is expected to be announced today, it is understood.
The heavily-negotiated deal will extend the ceasefire between the US and Iran, as reported by Axios, while paving the way for talks on a nuclear agreement.
It is believed Iran will be given greater control over traffic of the sea channel, which carries around one fifth of the global oil and liquefied natural gas supplies, as part of the deal.
This move would place Iran in a stronger position than before the Iran War started in February, with a more fortified hold over the world’s most vital energy chokepoint.
Iran refused to hold direct discussions with the US over the five-month war. Instead, Tehran said it is working with Oman as a mediator between the two nations.
Reports of the deal came after President Donald Trump threatened a massive attack was in store in Iran but later called off the planned assault, saying he wanted to allow for negotiations to resume.
‘It was going to be a massive attack,’ the US president told reporters on Monday. ‘It was going to be an attack that would have been, by far, the biggest attack since WWII’.
The potential deal would set up a 60-day temporary arrangement between Oman and Iran on the Strait, which could be extended, according to two regional sources.
President Donald Trump over the weekend threatened a massive attack was in store in Iran, but later called off the planned assault
The Strait of Hormuz (pictured) is posed to reopen under a potential deal between the US and Iran set to be announced today, it is understood
Under which, all traffic travelling into the Gulf would keep to Iranian waters, while outbound traffic would stick to Omani waters.
No tolls or fees would be charged during the 60-day period, while naval mines would be set to be cleared within 30 days – opening up the rest of the channel.
The deal could see the creation of a ‘voluntary fund’ for the upkeep of the waterway, as reported by The Telegraph, with European countries footing the bill.
The voluntary fees paid by Gulf countries and some European members of the International Maritime Organisation (IMO) would funnel into funding the cost of managing navigation, environmental protection, search-and-rescue, alongside other services.
The plan, steered by Oman, takes inspiration from current arrangements behind the Strait of Malacca – linking the Indian Ocean to the Pacific – where ships voluntarily pay Indonesia, Malaysia and Singapore.
The proposal has not yet been put forward to any of the IMO’s 176 member states, which includes Iran, Oman and the US, according to a United Nations source.
The alleged deal would be the second reached by the White House and Tehran in a month, after Iran resumed attacks on ships in June – bringing an end to a ceasefire, while igniting two weeks of conflict.
The US President insisted on Monday that negotiations were close to ending the war, adding Iran would be given ‘one last chance’ to make the deal or suffer further strikes.
Meanwhile, Iran maintained the re-opening of the waterway hinges on the US lifting its naval blockade.
It also denied Trump’s claims there were ongoing peace talks between Tehran and Washington, adding talks were taking place with Oman on management of the Strait of Hormuz.
Stock prices rallied to record highs on Tuesday after Trump’s Treasury Secretary Scott Bessent indicated that the deal between Tehran and Washington was imminent.
This comes after months of economic turmoil fuelled by rising oil prices.
‘We are in talks with the Iranians,’ Bessent told CNBC in an interview.
‘There is a chance we may have a deal today or tomorrow to open the strait and move towards a more normalized position in this conflict.’
Bessent said Trump’s threat of force encouraged the Iranian delegation to restart negotiations after the latest memorandum of understanding, signed June 17, fell through after Iran fired missiles at US forces.
‘We’ve seen President Trump last week threaten what would have been the largest military campaign since World War II against the Iranians, and now because of that we are in talks with the Iranians,’ Bessent said.
Trump opted to call off the attack after speaking with the leaders of allied countries in the region.
‘I was asked to by Saudi Arabia, the UAE, by Qatar, and by Iran to hold off strikes. It would have been a massive attack,’ Trump said on Sunday about pausing the offensive.
‘When the allies asked to call it off, you gotta say, ‘Well, let’s see.’ And the reason why they asked is because I think there’s a deal.’
However, whistleblowers on Tuesday disclosed the US Army has burnt through nearly its entire arsenal of offensive precision missiles.
The officials, granted anonymity to discuss sensitive US military matters, told Reuters that the stocks of Army Tactical Missile Systems (ATACMS) and Precision Strike Missiles (PrSM) have dwindled to new staggering lows.
Two of the officials said the US has used ‘virtually all’ of these missiles in its stockpile.
All three sources expressed concern that the low stockpiles could hamper the US ability to fend off Russia, China and other adversaries.
Iranian missiles ‘Zolfaghar’ on display at the Azadi square in Tehran, Iran, July 30 2026
Their warning comes after reports that Trump’s top military adviser, Chairman of the Joint Chiefs General Dan Caine, reportedly warned Trump that dwindling supplies in the region could increase the risks faced by US forces there.
Lawmakers have also expressed concern over Caine and Secretary of War Pete Hegseth acting as ‘yes men’ for the President.
A fourth source told the outlet that Central Command, which organises US military forces in the Middle East, has expended nearly all the land-based missiles it had before the war began in February, though it has since restocked from other US stockpiles located across the globe.
Both the ATACMS and the PrSM systems allow for long-range strikes with deadly precision while not putting US pilots at risk. ATACMS can travel approximately 185 miles, while the newer PrSM system has a range around 300 miles.
They each cost over $1million per missile, with prices ranging far higher depending on the munition’s exact specs. The sources refused to reveal exactly how many of each munition remains in US inventories.
President Donald Trump, meanwhile, has repeatedly stressed the US has more than enough firepower to continue its war against the Islamic Republic.
He’s said the US has ‘far more munitions than anyone in the world’, adding it is ‘far more than we need’.
