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What if the same two weapons that have kept the US and Iran locked in war could also provide a way out? That is the gamble now being explored in New York. According to sources cited by Reuters, US and Iranian negotiators are discussing a phased arrangement that could see Tehran reopen the Strait of Hormuz in exchange for Washington lifting the economic blockade that has been squeezing Iran's economy.
The proposal would essentially turn the biggest points of pressure in the conflict into bargaining chips. Iran wants the blockade lifted and could also seek access to frozen Iranian assets, while the US wants ships to move freely through Hormuz, which is critical route for global oil supplies.
According to Reuters, a senior Iranian official said the most plausible way forward could be to settle the crisis in stages. The first step, he said, would be for Washington to end the blockade and Tehran to reopen the waterway.
"One way forward would be to solve the crisis in stages. The first would be to end the blockade and reopen Hormuz," the official said on the sidelines of the UN General Assembly.
That would not necessarily amount to a final peace agreement. Instead, it would be another temporary arrangement, something both sides have attempted before. An earlier understanding collapsed in July.
Negotiators therefore face a difficult task: agreeing not only on what each side gives up, but also on how to make those concessions durable enough to prevent the conflict from flaring up again.
Trump has said he believes Washington and Tehran could reach a deal after the November 3 US midterm elections. A senior European official told Reuters that Iran "have a very long list of demands".
WHY BOTH SIDES ARE HOLDING ON
The very leverage that has brought the two sides back to diplomacy is also making a compromise harder. Washington has the economic pressure that is hurting Iran most. Tehran, meanwhile, controls access to a strategic waterway through which a huge volume of global energy normally passes.
Neither wants to surrender that advantage without getting something meaningful in return.
Former US negotiator Dennis Ross told Reuters he saw only a 30 per cent chance of an agreement being reached before the midterms. But he said both sides could have stronger reasons to strike a deal before the vote than after it.
"The blockade is what's really squeezing the Iranians. It's strangling them," Ross said.
IRAN MAY SOFTEN DEMAND FOR HORMUZ FEES
Tehran also appears to be showing some flexibility over how it wants to exercise control over the waterway. Regional sources told Reuters that Iran was willing to move its demand for transit fees out of the main agreement and place it in a separate attachment. Gulf states have rejected the idea of paying such fees.
That would allow the immediate focus to remain on reopening Hormuz and ending the blockade, while leaving the dispute over fees unresolved for later. The sources stressed that this would not mean Iran was abandoning its broader claim to administrative control of the waterway.
While diplomacy is taking place, Washington has continued to tighten economic pressure on Tehran.
The US has layered additional sanctions onto a blockade that has sharply restricted Iran's oil exports, an important source of hard currency. This month, Washington also targeted Iran's remaining commercial airlines and support networks as part of its campaign to cut economic lifelines to the Iranian government and the powerful Islamic Revolutionary Guard Corps.
Trump has warned that Iran's economy could "rot" unless Tehran reaches a deal.
But Tehran is not preparing only for diplomacy.
"Our fingers are on the trigger," the senior Iranian official told Reuters. "The Americans know what they need to do but, because of their excessive demands, the chances of diplomacy resolving this are extremely low."
GULF STATES WANT HORMUZ OPEN
The negotiations are also being closely watched by Gulf states, which have their own stake in how the confrontation ends.
During a separate meeting with Trump in New York, Gulf leaders sought clarity about Washington's plans beyond the midterm elections, including whether the US could resume military action if Iran refused to return to negotiations.
They rejected any arrangement that would give Iran lasting control over Hormuz as a tool of pressure and stressed that freedom of navigation must be restored. At the same time, Gulf states have pushed for de-escalation, wary of being dragged deeper into another prolonged US-Iran conflict.
"It's still not clear what Trump's endgame is, or what the alternative to the pressure campaign would be," Ebtessam al-Ketbi, president of the Emirates Policy Center told Reuters.
"The Iranians, by contrast, know what they want. They're reshaping the regional landscape through Hormuz and Bab el-Mandeb with a clear objective while Washington has yet to define its roadmap," she said.
At this stage, the talks are exploratory, and the fundamental positions of Washington and Tehran have not changed dramatically.
The US wants its economic and military pressure to produce concessions. Iran wants that pressure removed before making those concessions. Gulf countries want the war to end without allowing strategic waterways to become permanent bargaining tools.
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