Strait of Hormuz: Iraqi Oil Transit and Iran-Oman Diplomacy

Oman and Iran have initiated diplomatic discussions to establish a framework for the safe transit of vessels through the Strait of Hormuz, following a period of effective closure since the start of the Iran war on February 28, 2026.

According to the Omani Foreign Ministry, deputy foreign minister-level talks were held on Saturday, April 4, 2026. The meetings, which included specialists from both nations, focused on options to ensure the smooth passage of ships through the narrow waterway during the current regional instability.

The Omani Foreign Ministry announced the details of the meeting on Sunday, April 5, 2026, via a post on X, stating that experts from both sides presented several visions and proposals that are currently under study.

Proposed Monitoring Protocol

The diplomatic effort coincides with reports from the Iranian state news agency IRNA that the two countries are drafting a protocol to monitor transit through the strait. Iranian official Kazem Gharibabadi, the deputy foreign minister of legal and international affairs, stated that tanker traffic should be supervised and coordinated with Oman and Iran.

Gharibabadi clarified that these requirements are not intended as restrictions, but are meant to facilitate and ensure safe passage and provide better services to ships that pass through this route.

The announcement of these talks and the potential for a coordinated monitoring system led to a temporary easing of oil prices and a recovery in U.S. Stock indexes on April 2, 2026, after markets had reacted to signals that the conflict would persist for weeks.

Recent Vessel Movements

Despite the ongoing tensions, tracking data monitored by Lloyd’s List indicated that on Sunday, April 5, 2026, three Omani ships transited the Strait of Hormuz. The convoy, which included two large oil supertankers and one liquefied natural gas (LNG) carrier, was observed sailing unusually close to the Omani coast and outside of Iran’s approved corridor near Larak Island.

Separate reports indicate that ships carrying Iraqi cargo have also been seen transiting the strait. Iran has explicitly stated that Iraqi ships are permitted to use the waterway, and a Petronas-chartered tanker loaded with Iraqi crude was reported to have passed through the strait.

Strategic Importance of the Strait

The Strait of Hormuz is a critical global oil transit chokepoint, separating the Arabian Peninsula from Iran and connecting the Persian Gulf with the Gulf of Oman and the Arabian Sea. In 2025, an average of 20 million barrels per day of crude oil and oil products passed through the strait, representing approximately 25% of the world’s seaborne oil trade, with 80% of those shipments destined for Asia.

The waterway serves as the primary export route for several major producers, including:

• Saudi Arabia
• United Arab Emirates (UAE)
• Kuwait
• Qatar
• Iraq
• Bahrain
• Iran

While Saudi Arabia and the UAE possess some export routes that bypass the strait, other nations such as Iraq, Kuwait, Qatar, and Bahrain rely on it for the vast majority of their exports. The International Energy Agency (IEA) notes that a prolonged disruption could render a significant portion of the world’s spare production capacity unavailable.

Beyond oil, the strait is vital for the global gas trade. Approximately 93% of Qatar’s and 96% of the UAE’s LNG exports transit the waterway, accounting for roughly 19% of global LNG trade.

The physical constraints of the strait heighten the risk of disruption; at its narrowest point, it is only 29 nautical miles wide, with navigable channels for inbound and outbound shipping measuring only two miles wide each.