The Islamic Revolutionary Guard Corps (IRGC) has reported that Iran and Oman have reached an agreement on sharing revenues from the Strait of Hormuz. The IRGC spokesman stated that the United States is obstructing and delaying the negotiation process between the two nations.

Agreement details

According to the IRGC, the two neighbouring nations have reached a mutual understanding on sharing revenues derived from the Strait of Hormuz. The strait serves as a critical maritime passage connecting the Persian Gulf to the Gulf of Oman and the broader Arabian Sea.

The reported agreement signals a bilateral arrangement between the two countries on the financial dimensions of the strait's use. No further details on the terms, scope, or value of the revenue-sharing framework were provided in the source report.

Strategic significance and geopolitical context

The Strait of Hormuz is one of the world's most consequential maritime chokepoints, with a substantial volume of global energy trade transiting through its waters. Both Iran and Oman hold coastlines along the strait, giving each nation a direct stake in its governance and the revenues associated with maritime activity through the passage.

The IRGC specifically cited the US as an obstacle in the current diplomatic landscape. The source indicates that US actions are actively obstructing and delaying the Iran-Oman process of negotiations, which has led to delays in finalizing the implementation or broader scope of the agreement.

Iran’s Ministry of Foreign Affairs has condemned the US administration’s intensified economic pressure on Tehran, labeling it "systemic bullying" that annihilates international law. The response follows Treasury Secretary Scott Bessent’s confirmation that President Donald Trump is contacting world leaders to demand an end to all interactions with Iran.

Bessent emphasized that no country, including China, is beyond the reach of US sanctions as Washington moves to sever Tehran's economic lifelines. He outlined two paths for Iran: normalcy or total isolation. The US will block every potential revenue source for the Islamic Revolutionary Guard Corps (IRGC) and enforce a 'zero leakage approach' to Iran sanctions.

Global Enforcement Measures

Trump described the initiative as an economic D-Day designed to cripple Iran's ability to project terror and prevent nuclear acquisition. He warned that any nation providing a financial lifeline to Tehran would face severe consequences. Specific channels identified for immediate cessation include oil smuggling, swap lines, cash transfers, exchange houses, ship registries, and front companies.

The announcement follows the expiration of a 60-day US-Iran memorandum of understanding. In April, Defense Secretary Pete Hegseth said the Treasury Department had launched Operation Economic Fury to escalate pressure on Iran.

Iran’s Diplomatic Response

Iran’s Foreign Affairs Spokesperson Esmaeil Baqaei criticized the move on X on Tuesday, stating that countries appearing "obedient" might accept the measures, but they are "absolutely not fine." He argued that when every bank, company, port, and government must choose between obeying Washington’s whims or facing American vengeance, it is no longer just about Iran.

Baqaei cited the administration’s failed talks with Canada as evidence of this approach. He added that states valuing sovereignty would not accept the normalization of such grand lawlessness by the US.

Escalating Military Tensions

Iran is reportedly weighing strikes on US military targets in Europe, including Bulgaria's Bezmer air base and a British base in Cyprus. A NATO spokesperson told CNN that the alliance is prepared to address any threat. The US Navy has tightened its grip on the Strait of Hormuz, with more than 80% of tanker traffic taking a US-backed route through Omani waters.

Iran’s Security Chief stated that participating in the economic restrictions on Iran was equivalent to an "act of war." He also said that oil would not flow through the Strait of Hormuz. Despite this, Iran and Oman are reportedly in talks to open a temporary corridor to move vessels through the waterway.

At the time of writing, West Texas Intermediate (WTI) crude oil was trading at $80.16/bbl, while Brent crude was at $85.86/bbl. The United States Oil Fund (NYSE: USO) slipped 1.15% to $124.65 during pre-market trading on Wednesday.

Domestic Political Backlash

Trump has faced staunch criticism over his handling of tensions with Iran as energy costs and grocery bills continue spiking in the US. Sen. Elizabeth Warren (D-Mass.) accused him of profiting from the Iran war, pointing to his multi-million dollar holdings in oil companies like ExxonMobil Holdings Corp (NYSE: XOM) and Chevron Corp (NYSE: CVX).

Gov. Gavin Newsom (D-CA) pointed out that Trump had earlier claimed the Strait of Hormuz no longer had mines, a claim contradicted by recent developments. Oil prices remained volatile amid these conflicting signals.

Canada Trade Uncertainty

Failed trade talks with Canada pose uncertainty over tariffs, as Trump threatened to impose 50% tariffs on Canada. Canadian PM Mark Carney countered with retaliatory tariffs on US goods. Trade talks reportedly fell through after Commerce Secretary Howard Lutnick intervened.

Gov. Gretchen Whitmer (D-MI) slammed the tariffs, saying they would result in additional taxes on Michigan residents and could cause job cuts in the state’s auto sector. Economist Peter Schiff warned they may intensify cost-of-living woes in the US.