US President Donald Trump dances at an event in Las Vegas on Wednesday (local time). [AP]
US President Donald Trump dances at an event in Las Vegas on Wednesday (local time). [AP]

US President Donald Trump finds himself caught between two unpalatable options: escalating the conflict with Iran or accepting a negotiated arrangement that would effectively recognize Tehran's control over the Strait of Hormuz. With roughly 80 percent of the US military's Terminal High Altitude Area Defense (THAAD) interceptor missile stockpile depleted, further escalation carries serious risk. Yet accepting the new shipping lane proposal put forward by Iran and Oman would amount to acknowledging Iranian authority over the strait — a direct contradiction of the freedom-of-navigation principle Washington has long upheld. Some observers note that concessions granting Iran some form of control over the strait have already been made, and that the real dispute now centers on how that control is defined.

The Wall Street Journal reported Wednesday (local time), citing sources, that Iran and Oman have agreed on the core elements of a draft deal to establish a new inbound shipping lane near Iranian waters and a separate outbound lane near Omani waters, and have conveyed the proposal to the United States, Iran and regional countries.

Iranian Foreign Ministry spokesperson Esmail Baghaei confirmed Wednesday that the two sides had reached agreement on the geographic coordinates of the proposed lanes, adding that a joint statement between Iran and Oman was under review and in its final stages. Iranian Deputy Foreign Minister Kazem Gharibabadi said the new route being coordinated with Oman would be a temporary arrangement lasting two to four months. He stressed that reopening the Strait of Hormuz required specific conditions to be met and that any agreement must be reached solely between Iran and Oman. "We will not tolerate any foreign interference," he said.

Under the draft deal obtained by the Wall Street Journal, vessels entering the Strait of Hormuz would use an Iran-side lane coordinated with Tehran, while vessels exiting would use a lane within Omani waters coordinated with Muscat. Iran would gain control over ships entering the Persian Gulf through the strait but would not be permitted to impose transit fees or service charges. Sources added, however, that while formal tolls and fees are excluded, the arrangement may not prevent Iran from receiving voluntary payments under the guise of covering security and search-and-rescue costs.

However, a senior Iranian official cited by Reuters said Iran is demanding fees equivalent to 5 to 7 percent of the cargo value of ships using the strait. Oman is separately discussing a fee of around 3 percent, while the United States opposes any fee arrangement altogether.

The official said the current draft includes provisions giving Iran control over vessels entering the Persian Gulf, but that Iran's role regarding ships traveling in the opposite direction remains a key unresolved issue.

On Wednesday, Trump said the Strait of Hormuz "will be open soon, or Iran will face a very powerful attack," adding that negotiators had been in talks all day and that discussions were proceeding smoothly. "We will know the results within 48 hours," he said.

Reuters reported that Trump is caught between accepting a deal that largely accommodates Iran's terms and escalating the conflict, and that any outcome is expected to fall well short of the goals he set when he launched the war against Iran. The report also noted that some observers are cautious about expectations of an imminent deal, pointing out that significant issues remain unresolved.

The strain on US missile defense stockpiles is also narrowing Trump's options. Ammunition shortages are cited as one reason he held off last weekend on additional airstrikes against Iran that he had been considering. About 80 percent of the military's THAAD missile inventory has been depleted, and long-range precision-guided missiles are nearly exhausted.

Trump, who at the outset of the war vowed to secure Iran's unconditional surrender and even claimed a role in selecting its supreme leader, now faces mounting political pressure to chart an exit strategy ahead of the November midterm elections.

A liquefied petroleum gas carrier arrives at Mundra Port in India through the Strait of Hormuz in March. [Reuters]
A liquefied petroleum gas carrier arrives at Mundra Port in India through the Strait of Hormuz in March. [Reuters]

The prolonged standoff is weighing on global oil markets. Each day the strait remains closed, roughly 15 million barrels of crude oil are blocked from passing through. The extended disruption is rapidly drawing down crude inventories held by countries and refiners worldwide.

Amin Nasser, CEO of Saudi Aramco, the world's largest oil company, said that even if the Strait of Hormuz reopens Thursday, it could take up to 18 months to replenish depleted crude stockpiles.

Separately, Iran has reportedly warned Gulf states that it will strike critical energy infrastructure in the region if the United States attacks it again.

CNN said that while Trump is emphasizing the possibility of an early deal, it remains unclear whether Washington will accept the degree of control over the strait that Iran is demanding. Ultimately, even if an agreement is reached, it is increasingly likely to take the form of a compromise that recognizes some measure of Iranian influence — rather than the outcome the Trump administration had sought.


mokiya@heraldcorp.com