Treasury Secretary Scott Bessent told CNBC a deal to reopen the Strait of Hormuz could land within hours, even as an Indian cargo ship sank in the Red Sea and a projectile struck another vessel near the strait itself.
Oil prices dropped more than six percent on Tuesday, falling below $79.00 a barrel on Brent North Sea crude, after Bessent's remarks rekindled market hopes that the critical shipping lane might reopen. The strait carries a massive share of the world's oil and gas supply, and its effective closure by Iran over the past five months has rattled energy markets and strained the global economy.
The diplomatic push comes after more than five months of conflict between Washington and Tehran, a campaign that has cost the United States billions of dollars without producing a lasting resolution. A ceasefire and a preliminary deal were reached at earlier stages, but diplomacy has so far failed to end the fighting or fully restore commercial transit through the strait.
Bessent's comments on CNBC were the most direct signal yet from a senior administration official that an agreement was close. Bessent told the network "there is a chance we may have a deal" in the coming hours to reopen the strait and move toward a more stable footing in the conflict.
President Trump, speaking from the White House on Monday, framed the moment in blunter terms. He warned Tehran that this was its "last chance before decapitation" and called the Iranian government "duplicitous" for publicly denying that any negotiations were taking place. Trump said a U.S. counter-blockade of Iranian ports would remain in place "unless a Deal, or Total Surrender, is accomplished."
Trump described the negotiations as "not very complex" and said he expected to know by Tuesday how the talks were going, "one way or the other." He cast the reopening of the strait as the first stage of a broader diplomatic effort, with Iran's denuclearization as the longer-term objective, something he acknowledged could "take a little while."
AP News reported that the emerging deal would establish designated shipping lanes, with Iran controlling the entry route and Oman controlling the exit route. The United States has insisted that no tolls or Iranian approval should be required for transit.
Secretary of State Marco Rubio confirmed Tuesday that the United States was involved in negotiations between Oman and Iran on increasing traffic through the strait. Rubio said there had been "progress made in those talks, but not finality yet," adding, "We're hoping that will happen very shortly."
Iran's foreign ministry flatly denied negotiating with Washington. The New York Post reported that Iranian Foreign Ministry spokesman Esmail Baghaei issued a pointed clarification:
"To avoid any misunderstanding, it is important to clarify what the current negotiations are about and who they are with. We are not negotiating with the United States at this time."
Tehran's position is that talks are being conducted through Oman as an intermediary, focused narrowly on safe passage through the strait. That framing puts distance between Iran and any appearance of yielding to American pressure, even as the regime's economy buckles under the weight of sanctions and a five-month conflict.
Qatar has also played a mediating role. Qatar's leader, Sheikh Tamim bin Hamad Al-Thani, spoke with Trump by phone on Tuesday. A statement from Doha said they discussed "efforts to de-escalate tensions." But Qatar's government also said no direct Iran-U.S. talks were planned, despite the ongoing diplomatic activity.
The gap between what Washington says is happening and what Tehran admits to is worth watching. Trump's administration has repeatedly described an active negotiation; Iran has repeatedly denied it. That contradiction has persisted for weeks, and it has not slowed the talks, Trump called off a planned strike on Iran after Tehran and regional allies signaled willingness to deal on Hormuz and the nuclear program.
Iran has been imposing an effective blockade on the Strait of Hormuz, insisting that ships coordinate their crossings with Iranian authorities and seeking to charge tolls, powers Tehran had never exercised before the conflict began. The toll scheme amounts to an attempt to monetize control of one of the world's most important shipping lanes while the regime faces severe fiscal strain.
Bessent moved to shut that revenue stream down. The Washington Examiner reported that the Treasury secretary sanctioned Iran's self-proclaimed Persian Gulf Strait Authority, barring any entity from paying tolls to the organization under penalty of being cut off from the global financial system. Bessent called the tolling scheme proof that the broader sanctions campaign, dubbed Operation Economic Fury, "has left the regime desperate for cash."
The economic damage to Iran has been staggering. Experts cited in the Examiner's reporting estimated that the combined cost of the war and the sanctions campaign approached $150 billion. Bessent also extended sanctions to Iranian airlines, cutting off their access to landing spots, refueling, and ticket sales worldwide.
Trump's broader strategy has been to combine military pressure with economic strangulation. Last week, he threatened to hit Iran "very hard", potentially targeting civilian infrastructure, before pulling back and hinting that a deal was near. That pattern of escalation followed by restraint has defined the administration's approach for months, and it has drawn both praise and criticism on Capitol Hill, where Senate Republicans blocked a Democratic war-powers push as the deal neared its finish line.
Even as diplomatic optimism grew, the violence continued. Britain's maritime security agency, UKMTO, reported early Tuesday that an unnamed cargo vessel had been struck by an "unknown projectile" in the Strait of Hormuz off the coast of Oman. One crew member was listed as missing.
The identity of the attacker was not disclosed. The incident underscored the persistent danger in the strait, where Iran has been firing missiles and drones at U.S., allied, and commercial targets throughout the conflict.
Separately, the Indian ship MSV Faize Noore Oliya sank in the Red Sea off Yemen following an unattributed attack. All crew members were rescued. The Houthi rebels, an Iran-backed militia in Yemen, have declared a maritime blockade on Saudi Arabia in the Red Sea and have claimed attacks on multiple ships they say violated the blockade.
The Houthi campaign is not new. During the earlier Gaza conflict, Houthi attacks on commercial vessels forced shippers to take lengthy detours around the southern tip of Africa, adding weeks and enormous cost to global supply chains. The current Red Sea blockade extends that pattern, though Saudi Arabia has been able to maintain some shipments to global markets through its Red Sea port at Yanbu, bypassing the Strait of Hormuz entirely.
The sinking of the Indian vessel and the Hormuz projectile strike land at the worst possible moment for diplomats trying to sell markets and the public on an imminent breakthrough. A deal on paper means little if ships keep taking fire. Trump has previously threatened to target Iranian infrastructure for every attack on Hormuz shipping, a warning that remains on the table.
Markets reacted swiftly to Bessent's comments. Brent crude fell more than six percent to below $79.00 a barrel, reflecting traders' bets that a reopened strait would ease the supply crunch that has kept energy prices elevated for months.
But the New York Post noted that further price relief would depend on actually moving the hundreds of ships stranded by the blockade. A signed agreement is one thing; clearing a backlog of tankers and cargo vessels through contested waters is another. Until those ships move, the economic damage accumulates, for American consumers paying higher gas prices, for global shippers absorbing insurance and rerouting costs, and for allied nations dependent on Gulf energy supplies.
The administration is under pressure to deliver results before the midterm elections. Rising gas prices and questions about depleted military stockpiles have given Democrats political ammunition. Trump paused the Iran strike campaign after a top general flagged concerns about dwindling interceptor supplies, a decision that drew scrutiny but also opened space for the current diplomatic track.
Defense Secretary Pete Hegseth pushed back forcefully on a CNN report claiming the U.S. had exhausted nearly eighty percent of its THAAD missile interceptors and roughly half of its Patriot interceptors during the conflict. Hegseth posted on social media that CNN's reporting was "NOT TRUE," adding, "We don't hate the Fake News media enough." Senior military commanders had reportedly warned the Pentagon that stockpiles were "dangerously low," but Hegseth's denial put the administration squarely at odds with the network's sourcing.
In a sign of what the endgame might involve, the Treasury Department has already issued a sixty-day sanctions waiver on Iranian oil exports after Iran agreed to allow International Atomic Energy Agency inspectors into the country and committed to keeping the strait open. Just the News reported that the waiver allows Iran to resume crude oil exports at market rates for the first time in years, after a long stretch of selling at steep discounts because of sanctions.
Bessent framed the waiver as part of the "ongoing productive talks," noting that Iran had committed to free and open transit in the strait and to permitting IAEA inspectors. The sixty-day window gives both sides a defined period to test whether commitments hold, and gives the administration a lever to reimpose pressure if Iran backtracks.
Trump's two-phase framework, strait first, denuclearization second, is designed to produce a quick, visible win on energy prices while buying time on the harder nuclear question. It is a pragmatic sequence, and it reflects the political reality that voters care more about the price at the pump than about centrifuge counts at Iranian enrichment facilities.
Whether Iran will follow through is the question that matters. Tehran has denied negotiating, insisted on its right to control the strait, and continued to support Houthi operations in the Red Sea, all while quietly engaging through Oman. That gap between public posture and private behavior is familiar to anyone who has watched Iranian diplomacy over the past two decades.
Deals with Iran have a way of looking better on the day they are announced than on the day they are tested. If this one holds, American consumers and global markets will benefit. If it doesn't, the administration will have to decide whether the credibility cost of another failed agreement is worth the diplomatic effort, or whether the leverage Trump has built deserves a harder landing.
