Negotiations for the Reopening of the Strait of Hormuz: Recurring Patterns and Corporate Response Strategies

Executive Summary

Iran proposed to reopen the Strait of Hormuz within seven days, contingent upon the easing of U.S. military pressure. This proposal reflects a recurring structure similar to the Islamabad Memorandum from June. Given that President Trump made statements indicating proximity to an agreement just hours after threatening Iran in his UN General Assembly speech, and the presence of an uncontrollable variable regarding Prime Minister Netanyahu's decision on whether to halt airstrikes in Lebanon, it is premature to conclude that this roadmap marks the end of the recurring structure. The optimistic implementation probability stands at 20%, while partial implementation and re-impasse are most likely at 50%. South Korean companies should establish a structure that can minimize losses through all three avenues: expanding spot contract proportions, delaying the return to normal shipping routes, and diversifying procurement sources, rather than betting on the negotiation outcomes.

I. Issue Situation Analysis

Accelerating Negotiations for the Reopening of the Strait of Hormuz: Issue Situation Analysis

1. Background and Current Situation

On September 22, a senior Iranian official visiting New York for the UN General Assembly stated that Iran would open the Strait of Hormuz within seven days if the U.S. took initial steps to ease military pressure[1][12]. This proposal has already been communicated to the U.S. through a mediator[1]. On the same day, President Trump mentioned after a meeting with UK Prime Minister Andy Burnham that "they want to talk to us," indicating that both sides are close to an agreement[10]. However, just hours earlier, Trump had reiterated threats to annihilate Iran if it failed to reach an agreement in his UN General Assembly speech[10]. Thus, both hardline and conciliatory statements emerged simultaneously on the same day.

On September 24, Iranian Foreign Minister Araghchi held a closed meeting in New York and explained specific conditions to outlets such as The New York Times and The Guardian[4][7][14]. The conditions are threefold: the lifting of the U.S. maritime blockade, exemption from sanctions on Iranian oil exports, and compliance with a ceasefire that includes Lebanon[7][14]. On the same day, Reuters reported that the New York negotiating team was reviewing a phased path to ceasefire[9][11][15]. Reuters emphasized that the reopening of Hormuz has emerged as a key leverage point in the negotiations[9][11].

The calculations on the U.S. side are not straightforward. According to The Guardian, to achieve reopening within seven days, President Trump would need to lift the freeze on Iranian assets, allow Iranian oil exports, and instruct Prime Minister Netanyahu to halt attacks on Hezbollah in Lebanon[4]. It is pointed out that whether the U.S. can control the Israeli variable is crucial[4]. While the Trump administration seeks to leverage this negotiation as an opportunity to escape a political crisis ahead of the midterm elections, The Guardian views the costs of such a strategy as significant[4].

2. Key Actors and Interests

The Iranian Governmentis under pressure from economic sanctions, which are a key incentive for negotiations. As pointed out in an interview with Columbia University's CGEP, the absence of certain parties in the discussions regarding the return to a U.S.-Iran MoU remains a variable[5]. Iran prioritizes the lifting of asset freezes and the resumption of oil exports[7][9][11][14][15], and has expanded the scope of negotiations by including a ceasefire related to Hezbollah in Lebanon[4][7][14]. This is interpreted as a strategy to shift the responsibility for the Israeli variable onto the U.S.

The Trump Administrationis in need of diplomatic achievements before the midterm elections[4]. However, it is uncertain whether it can compel Israel to halt attacks in Lebanon in accordance with Iranian conditions[4]. The disparity between the annihilation threat mentioned in the UN General Assembly speech and the tone of statements made afterward suggests a division between hardliners and negotiators within the White House[10].

SIPRI has raised concerns about the structure of these negotiations. Given the specific wording of certain provisions in the Islamabad Memorandum signed on June 17, there is a possibility that the U.S. could grant Iran the authority to permanently restrict freedom of navigation in the Strait of Hormuz as part of a final peace treaty[2]. SIPRI warned that this could have economic, political, and legal repercussions on the principle of freedom of navigation worldwide, extending beyond the Gulf region[2].

Chinais not a direct negotiating party but is a structural stakeholder. According to EAI analysis, China accounts for over 80% of Iranian oil imports, making it unlikely to abandon this share[6]. This background indicates that U.S. sanctions against Iran will, in practice, be selectively and gradually enforced[6].

3. Key Issues

The first issue is the controllability of the Israeli variable. The ceasefire that Iran demands regarding Lebanon pertains to military actions by Israel, not the U.S.[4][7][14]. Whether the Trump administration can enforce this on the Netanyahu government will determine the feasibility of the seven-day roadmap.

The second issue is whether the principle of freedom of navigation will be compromised. As SIPRI pointed out, if the final agreement includes provisions recognizing Iran's control over navigation, it would set a precedent that goes beyond merely resolving a regional dispute and impacts the entire international maritime law order[2].

The third issue is the recurring pattern of agreement and violation. There is a precedent of a similar agreement being violated just over two months after the signing of the Islamabad Memorandum in June[3][6]. The current seven-day roadmap could also follow a similar path depending on the implementation of initial measures, the continuity of the mediation channel, and how the Israeli variable is handled. A cautious approach is required to assess the position of this proposal within the existing structure of alternating negotiations and tensions.

II. In-Depth Issue Analysis

Accelerating Negotiations for the Reopening of the Strait of Hormuz: In-Depth Issue Analysis

1. Fundamental Cause Analysis

The fundamental cause of the current negotiation phase stems from the fact that both sides are exhausting their capacity to continue the war. The core of Iran's calculations is economic. The conditions presented by Foreign Minister Araghchi in the closed meeting in New York are the lifting of the maritime blockade, exemption from oil export sanctions, and compliance with a ceasefire that includes Lebanon[4][7][14]. Among these, the resumption of oil exports is the most urgent item. Al-Monitor reported that Iran is trying to escape from the economic stranglehold imposed by U.S. sanctions[11]. After nearly seven months of blockade, the oil export routes within Iran have effectively been blocked[9][11][15].

The U.S. side's reasons are directly related to political schedules. The Guardian analyzed that this roadmap is packaged as an agreement that could quickly extricate President Trump from a political crisis[4]. Ahead of the midterm elections, there exists an incentive within the Trump administration to secure both stable oil prices and an end to the war. However, the same individual reiterated threats to annihilate Iran in his UN General Assembly speech on the same day[10]. The coexistence of hardline rhetoric and expressions of willingness to reach an agreement within a single day indicates that the U.S. policy toward Iran has not yet been clarified.

For both countries, Hormuz is not just a transit route. For Iran, it is almost the only physical leverage to exert negotiation power. For the U.S., it is the point where the responsibility for the global energy market collides with its security commitments to Israel. This structural asymmetry is a fundamental factor that both advances and weakens the negotiations.

2. Structural Context

The biggest variable in the political structure is Israel. The Guardian pointed out that for reopening to be realized within seven days, President Trump must instruct Prime Minister Netanyahu to halt attacks on Hezbollah in Lebanon[4]. This indicates that the U.S. cannot complete the roadmap solely through bilateral negotiations with Iran. Israel, while not physically present at the negotiation table, is a key actor with effective veto power. During a seminar at Columbia University's CGEP, researcher Karen Young noted that there are clearly absent parties in the discussions regarding the return to a U.S.-Iran MoU, which is also interpreted as a reference to the Israeli variable[5].

The economic structure is summarized by the asymmetric dependency in the energy market. Before the war, approximately one-fifth of the world's oil supply passed through the Strait of Hormuz[7][8][10]. According to PIIE, an average of 88 vessels passed through the strait daily before the outbreak of hostilities[6]. Since the outbreak, this traffic has plummeted to a level close to blockade, with Brent crude soaring to $94.06 per barrel on August 20[8]. EAI previously presented the $88–95 per barrel range as the "high oil price new normal" basic scenario in a report[8]. Even if this roadmap is realized, whether this range itself will be dismantled remains a separate issue.

In terms of security structure, the principle of freedom of navigation clashes directly with Iran's claims of control over its territorial waters. SIPRI, analyzing the wording of the Islamabad Memorandum signed in June, pointed out the possibility that the U.S. could effectively allow Iran to permanently restrict freedom of navigation in the Strait of Hormuz in the final peace treaty[2]. SIPRI warned that this could lead to economic, political, and legal repercussions that extend far beyond the Gulf region[2]. This means that the current negotiations may not only lead to a short-term resumption of navigation but could also set a precedent for the entire international maritime law order. EAI's previous report noted that Iran's unilateral navigation system has effectively become the standard route[3]. The phenomenon of a temporary navigation system being solidified without legal status clarification has already been underway.

3. Background of Events and Recurring Structure

To evaluate this roadmap, it is essential to first examine the precedent of the Islamabad Memorandum from June. The memorandum, signed on June 17, declared an "immediate and permanent cessation of military actions on all fronts"[3]. Immediately after signing, President Trump sent a message saying, "Ships of the world, turn on your engines"[3]. However, this memorandum expired on August 17, after which Iran shifted to an offensive posture[3][6]. In mid-July, Iran even blocked navigation through Hormuz in response to U.S. bombings in the South[12]. Thus, a similar pattern of agreement and violation had already occurred just three months prior.

It is important to clarify that this recurring structure is not new. As noted in EAI's August report, a basic scenario of alternating negotiations and tensions has already been observed multiple times since the outbreak of hostilities[3]. The cycle of temporary agreements, expiration or violation, military tensions reigniting, and new negotiation proposals has persisted for over six months. EAI's existing assessment suggested that this seven-day roadmap should also be viewed as a new phase in this cyclical loop.

However, this phase contains elements that distinguish it from previous ones. First, the negotiation channels have diversified. The initial proposal was reported through Kyodo News[1][12], followed by Foreign Minister Araghchi's direct briefing in New York[4][7][14], and Reuters' coverage of the New York negotiating team[9][11][15], all occurring almost simultaneously. This indicates that verification through multilateral channels is being conducted more thoroughly than during the signing of the June memorandum. Second, the roadmap is distinct in that it specifies a deadline. While the June memorandum declared a comprehensive cessation of military actions, this proposal outlines a phased implementation plan with a specific deadline of seven days[1][4][9]. Third, the domestic political schedule of the U.S. midterm elections is acting as a clear pressure factor this time[4].

4. Key Variables Shaping Issue Development

The first variable is whether Israel will cooperate. Whether President Trump can instruct Prime Minister Netanyahu to halt attacks in Lebanon, and whether Israel will accept such instructions, is the biggest hurdle to implementing the roadmap[4]. This variable lies outside the control of the U.S., meaning that no matter how much the negotiating parties, the U.S. and Iran, narrow their differences, it possesses the power to derail the negotiations.

The second variable is the consistency of U.S. policy toward Iran. The simultaneous emergence of hardline threats and signals of willingness to reach an agreement on the same day[10] suggests that there are differences in policy direction within the Trump administration. Whether this inconsistency can be resolved during the actual implementation phase, or whether it will undermine the momentum of negotiations, is crucial.

The third variable is how the freedom of navigation clause is treated in the final agreement. As SIPRI pointed out[2], if any wording that partially institutionalizes Iran's control over navigation is included, it will set a precedent that goes beyond mere lifting of the blockade and impacts the international maritime law order. In this case, major maritime nations outside the Gulf region may also have interests in this agreement, and the scope of negotiations could expand beyond the U.S.-Iran bilateral framework.

The fourth variable is whether the legal status of Iran's unilateral navigation system will be clarified. Given that this system has already become "effectively the standard route"[3], whether this roadmap will officially replace it or coexist with it will significantly affect future navigation stability. If the legal status remains uncertain while the practice solidifies, the "risk of abrupt operational cessation" warned by EAI in previous reports will not be alleviated[3].

If any one of these four variables goes awry, this roadmap will likely follow a path similar to that of the June memorandum, leading to delays in implementation and re-violation. Considering the patterns that have repeated over the past six months, caution is required in interpreting the radical advancement of this proposal as a signal of final resolution.