The proposal would reopen the Strait of Hormuz, a crucial shipping route that carries about 20% of the world’s traded oil and gas
The United States and Iranian negotiators reached a tentative agreement on Thursday to extend the ceasefire in their three-month conflict by 60 days and restart talks over Iran’s nuclear program.
Vice President JD Vance confirmed the preliminary deal but said President Donald Trump had not yet approved it because negotiators were still debating key language.
The proposed deal would reopen the Strait of Hormuz. Iran would remove mines from the waterway within 30 days and stop charging tolls on ships passing through the strait.
Reports of the possible agreement pushed oil prices lower on Friday, putting crude on track for its biggest weekly decline since April. Brent crude fell 1.3% to $92.47 a barrel, while US crude dropped 1.5% to $87.52.
Brent has lost 10.5% this week, while US crude has fallen 9.2%, as traders expect tensions in the Middle East to ease.
The deal also includes a gradual easing of US sanctions and a reduction of naval restrictions on Iranian ports. However, major disagreements remain over Iran’s stockpile of highly enriched uranium.
Meanwhile, regional tensions remained high after Kuwait intercepted Iranian missiles and drones, highlighting the fragile nature of the ceasefire.