Oil Drops 7% as US Hits Qeshm Island, Iran Signals Readiness to Reopen Strait
Washington launched limited defensive strikes on Iranian soil just hours before US midterm voting, while Tehran offered to restore global oil flows within 48 hours if specific terms are met.
By Jonathan Reed ·
Global oil prices plunged by more than 7 percent on Monday, a sharp decline driven by optimism regarding the potential end of an eight month old conflict between the United States and Iran. The market reaction followed reports of new military activity in the Strait of Hormuz and diplomatic signals from both capitals suggesting a path toward a settlement.
United States forces carried out strikes on Qeshm Island in the Strait of Hormuz, according to an American official who spoke late Monday. The official described the action as limited and defensive, noting it was not a resumption of major combat operations. Another official stated the strikes were a response to Iranian use of surface to air missiles against US assets. The Wall Street Journal first reported the attack, which Iranian state media IRNA corroborated by reporting several explosions on the island earlier in the day.
A separate incident involved a vessel transiting the strait that was struck by an unknown projectile, leaving a hole in the ship. The United Kingdom Maritime Trade Operations center reported that all crew members were safe. Iran has claimed responsibility for attacks on vessels it says took unauthorized routes, while the US military maintains that all internationally recognized routes have been cleared of mines.
President Donald Trump posted on Truth Social that Iran wants a settlement as soon as possible, a shift from his earlier signals that the midterm elections could mark the start of resumed war. Vice President JD Vance told reporters that he and the president were optimistic about securing an agreement. He noted that progress had been made and that further steps were possible.
Iranian negotiators have indicated a willingness to reopen the strait quickly if Washington accepts certain conditions. A senior Iranian official told Reuters that Tehran was ready to restore the key oil and gas route within two days. This offer follows a seven day plan proposed in September that included demands such as ending the war on all fronts, unfreezing Iranian assets, and lifting oil sanctions. Foreign Minister Abbas Araghchi described current indirect talks as intensive and delicate.
Mohammad Bagher Ghalibaf, Tehran’s chief negotiator, stated that Iran was ready for war but had given Washington a rational response. He added that the ball was now in America’s court to prevent conflict. Esmaeil Baqaei, the foreign ministry spokesman, called the potential for a two day reopening a sign of Iran’s good faith approach.
Diplomatic efforts continue through intermediaries. Qatari mediators traveled to Tehran on Monday night to discuss a draft US Iran deal that has been under negotiation for eight days. A senior Iranian official cautioned that Tehran’s conditions must be met before nuclear talks can begin. China announced it will send a special envoy to Iran, Oman, and Saudi Arabia in early to mid November.
At the Manama Dialogue in Bahrain, Gulf leaders expressed concern over the widening gap between US and Iranian positions. UAE presidential adviser Anwar Gargash warned that if these positions are not bridged, the worst scenario must be considered. Egyptian Foreign Minister Badr Abdelatty stated that the next escalation would be more dangerous and destructive.
