Hormuz Talks Postponed as Saudi Pipeline Shutdown Deepens Oil Supply Fears

Diplomatic efforts to ease tensions around the Strait of Hormuz stalled on Monday after a planned meeting between Iran and other Persian Gulf states was called off, with Oman's foreign minister, Sayyid Badr Albusaidi, saying the gathering had been postponed "in the interests of consensus."

Iranian officials had been expected to attend the talks with Gulf Arab states to present an agreement reached with Oman on managing shipping routes through the strait. An Iranian foreign ministry official said the postponement came at the request of some regional countries and was decided jointly by Tehran and Muscat, adding that Iran would work with Oman to fix a new date.

The delay followed Saudi Arabia's decision to keep its 1,200-km east-west pipeline shut after it was damaged in drone strikes on Friday. Traders and Saudi oil buyers said the kingdom has enough crude stored at its Red Sea port of Yanbu to sustain exports for only five to seven days if the pipeline remains offline. Beyond that, as much as 4% of global oil supply could be at risk, on top of volumes already lost to disruption in the strait.

Riyadh has not disclosed the full extent of the damage or how long the pipeline will stay closed, and estimates for repairs have ranged from days to weeks. Satellite imagery has shown large plumes of smoke along the route.

Shipping in the strait remains hazardous. A British maritime security agency reported that a vessel was hit by a projectile while transiting the waterway, sparking a fire and forcing the crew to evacuate. Iran said one person was killed and four crew members wounded when an Iranian commercial vessel was struck off its coast.

Oil prices climbed above $100 last week for the first time since July, and the average US retail price of diesel rose to a record above $6.20 a gallon.

In an interview with a London-based pan-Arab outlet, Iranian Foreign Minister Abbas Araqchi said that regardless of any arrangement with Oman, Iran would not reopen the strait until the United States meets Tehran's demands. Washington has yet to achieve the goals President Donald Trump set when he launched "Operation Epic Fury" in February: ending Iran's nuclear programme, preventing it from attacking its neighbours and creating conditions for a change of government.

Speaking during a weekend trip to Ireland, Trump said he still expects the Iran war to end this year, possibly after November's US midterm elections, after which gasoline prices would "drop like a rock."

Violence also continued along the Red Sea. Saudi state media showed video of damage to homes and a mosque from what it described as the latest cross-border attack by Yemen's Iran-aligned Houthi rebels in Jazan province. The Houthis said they struck a Saudi military base in a neighbouring province after seizing Perim Island in the Bab El-Mandeb, the strait at the mouth of the Red Sea.

The Houthi push along Yemen's Red Sea coast is the most intense fighting there in years, presenting Washington with a dilemma as it seeks to back Saudi Arabia and protect shipping without opening another front. Gulf states face a choice between absorbing economic pain and engaging with Iran.

The United States bombed the Houthis for two months in 2025 before Trump halted the campaign after saying the group had dropped its threat to Red Sea shipping. Three sources said Saudi Crown Prince Mohammed bin Salman called Trump on Thursday to request military aid against the Houthis but was offered only intelligence support for now. Trump confirmed the call and said the Houthis had also contacted his administration asking Washington to stay out of the Yemen war.