Oman’s Silent Win: How the Proposed Strait of Hormuz Deal Benefits Muscat

Oman has emerged as a key beneficiary from the recent ceasefire between the United States and Iran, even as both nations rushed to claim victories following their two-week agreement to halt hostilities.

The ceasefire plan includes a provision allowing both Iran and Oman to levy transit fees on ships passing through the Strait of Hormuz, a narrow 34-kilometer stretch at the mouth of the Persian Gulf that handles roughly one-fifth of global oil trade.

The waterway has historically been treated as an international passage with no toll imposed by either country.

According to news agency AP, officials in Tehran said the revenue generated from transit fees would be directed towards post-war reconstruction. The conflict has caused widespread damage to Iran’s defence, administrative, and civilian infrastructure.

US President Donald Trump described Iran’s proposal as "workable" after Tehran agreed to conditionally reopen the strategic route, which had effectively remained closed since the conflict began on February 28.

The closure, marked by attacks on vessels transiting the corridor, had triggered a sharp rise in global oil prices.

Trump said Iran had presented a 10-point proposal that was a "workable basis" for negotiations, adding that he expected an agreement to be "finalised and consummated" during the two-week window.

Further discussions on the future of the Strait and broader aspects of a long-term peace are expected during negotiations between the US and Israel, scheduled to begin in Islamabad on Friday.

Will the Strait of Hormuz Transit Fee Demand Shape the Final US-Israel-Iran Agreement?

Iran has indicated that any permanent peace agreement with US and Israeli forces must include provisions allowing it to impose transit fees on ships passing through the strait.

Reuters reported that the proposed fee structure would vary depending on the type of vessel, its cargo, and prevailing conditions.

Iran’s deputy foreign minister, Kazem Gharibabdi, said last week that Tehran was drafting a protocol with Oman that would require ships to obtain permits and licences to pass through the Strait. He said the move was intended to facilitate rather than restrict transit.

Several Gulf nations, including the United Arab Emirates and Qatar, have opposed the proposal, calling for free and open navigation. They have also said that any discussions on financial mechanisms should be deferred.

Oman stated that it had held talks with Iran on options to ensure smooth transit through the waterway but did not confirm whether any agreement had been finalised.

(With inputs from ANI)