Mohsen Rezaei’s son among nine identified in $11-billion Iran oil network

“Sanctions can't topple a regime on their own. That's not what they're for,” said Bitsoff, who previously worked at the Treasury Department’s Office of Foreign Assets Control, the agency responsible for administering and enforcing US economic sanctions. “They are intended to increase pressure.”

For Bitsoff, who worked on nonproliferation and weapons procurement at OFAC and is now executive director of investigations at TANGOS, the distinction is central to understanding what decades of US sanctions against Iran can and cannot accomplish.

Rather than expecting sanctions themselves to produce political change, she said their effect should be measured by how much they increase the cost and difficulty of the activities Washington is trying to constrain.

“They make everything that the regime does related to those more expensive, slower and more difficult to obtain,” she said, referring to activities such as Tehran’s nuclear and weapons programs. Sanctions, she added, are also intended “to set conditions for something else to happen” and “can't be alone.”

That argument comes after years in which successive US administrations have expanded, eased or more aggressively enforced different layers of sanctions against the Islamic Republic. Washington restored broad nuclear-related sanctions after withdrawing from the 2015 nuclear deal in 2018, targeting areas including Iran’s banking, energy and shipping sectors. President Donald Trump launched a renewed “maximum pressure” policy in February 2025, directing the Treasury Department to pursue a “robust and continual sanctions enforcement campaign” aimed at denying Tehran and its allied groups access to revenue.

Bitsoff said those measures should not be judged simply by how many Iranian individuals, companies or organizations Washington places on sanctions lists.

Enforcement matters more than numbers

“Numbers are not a good measure of the impact of sanctions and whether they are important,” Bitsoff said. “You can sanction thousands of individuals and entities within Russia, within Iran, within North Korea, and that's not really the answer.”

The more meaningful test, she said, is whether sanctions change the behavior of actors outside the targeted country — the banks, buyers, suppliers, shipping companies and intermediaries that allow sanctioned governments to continue obtaining money and material.

That often requires Treasury officials to identify specific weak points in complex networks rather than simply placing restrictions on an entire sector. Bitsoff described sanctions policy as operating on two levels: broad measures designed to restrict areas such as oil revenue or access to the financial system, and day-to-day operational measures targeting individual transactions, companies and procurement networks.

Weapons procurement provides one example of how that pressure works. Sanctions may not stop Iran from producing a missile or drone, Bitsoff said, but they can increase the cost of securing the components needed to build them and force manufacturers to rely on inferior alternatives.

“You raise the cost of procuring parts and components,” she said. “You force them to get worse parts and components, so their finished weapons are less effective.”

The effects can take years to become visible, she said, and may eventually be measured in missile failure rates or the ability of adversaries to jam drones and develop other countermeasures.

Iran’s reliance on foreign components has remained a focus of US sanctions. Treasury actions in 2025 and 2026 targeted networks in China, Hong Kong, the UAE and elsewhere accused of supplying Iran with drone components, missile propellant ingredients and other military goods. In June, OFAC sanctioned another group of China- and Hong Kong-based individuals and companies it said had supported weapons procurement for the Revolutionary Guards and Iran’s defense ministry.

Oil sanctions work differently, Bitsoff said. Rather than necessarily preventing a barrel of Iranian crude from reaching a customer, the restrictions can make every stage of that journey more expensive.

An Iranian shipment may have to pass through several intermediaries, rely on aging tankers carrying higher insurance costs, undergo ship-to-ship transfers and be sold at a discount to a limited pool of buyers willing to accept the risk of dealing in sanctioned oil. Ship managers, operators and others involved in the trade may also demand premiums because they risk becoming sanctions targets themselves.

“By the end of it,” Bitsoff said, Iran can be forced to absorb a “huge discount,” meaning export volumes alone do not provide a complete measure of whether sanctions are working.

The US Treasury has described many of the same methods in its recent actions against Iran’s oil trade, citing front companies, intermediary brokers, ship-to-ship transfers, falsified documents and manipulation of vessel identities. In April, Treasury said China was buying about 90% of Iran’s oil exports and that independent Chinese refineries, commonly known as teapots, accounted for most of those purchases.

Bitsoff said enforcement can therefore be thought of as a dial that Washington can turn up or down even when the underlying sanctions remain on the books.

She pointed to the period after the United States left the nuclear agreement in 2018, when tougher enforcement drove major buyers with exposure to the US financial system away from Iranian oil.

She contrasted that with the early years of the Biden administration, when she argued Washington eased enforcement as it sought to revive negotiations with Tehran, allowing Iran’s oil trade with China to adapt around smaller buyers with less exposure to the US financial system.

“The whole idea is to change behavior,” she said. “You don't wanna just sanction something and then walk away.”

Without continued enforcement, she said, companies treat a designation as a one-time event and find ways to adjust their operations around it. “If you don't keep up with that, if you don't make that enforcement visible, people are just going to keep doing what they want to do.”

Iran's sanctions evasion machine

Keeping up has become more difficult because Iran has spent years developing mechanisms to circumvent the restrictions imposed on it, Bitsoff said, describing a system largely developed by the Revolutionary Guards and the broader state during the intense sanctions pressure of the early 2010s.

“They have a sanctions evasion machine that works pretty well,” she said.

The core of that system has remained relatively consistent, relying on shadow banking, buyers willing to trade with Iran and efforts to avoid transactions vulnerable to the US financial system. But Bitsoff said Tehran has repeatedly adapted the mechanics when new opportunities appear, from deceptive tanker practices and cash smuggling to newer methods involving cryptocurrency.

“The pattern I can discern is that they'll just use anything at their disposal to evade sanctions,” she said.

China now occupies an especially important place in that system, both as the dominant destination for Iranian oil and as a source of components used by Iran’s military industries. The Treasury Department has increasingly targeted Chinese refiners, ports, shipping companies and procurement networks as part of the maximum-pressure campaign, including a June action against China- and Hong Kong-based actors accused of facilitating weapons purchases for the IRGC and defense ministry.

“Most evasion of sanctions, especially related to Iran, happens through China,” Bitsoff said. “Those are the front companies that move money. They're the buyers of oil. They're the suppliers of weapons components.”

That makes pauses in enforcement against China particularly significant, she argued, because companies and intermediaries watch US actions when deciding how much sanctions risk they are prepared to accept.

Bitsoff said this helps explain why sanctions cannot be regarded as an on-off mechanism capable either of completely stopping Iran’s activities or, at the other extreme, being dismissed as ineffective because those activities continue. Their purpose, in her view, is degradation: reducing revenues, increasing costs and making military and nuclear programs harder to sustain.

That pressure also has a domestic dimension, she said, because Iran’s leadership must contend with economic mismanagement while the public sees resources being directed toward military programs and allied armed groups rather than economic opportunity at home.

“The population knows that it's funneling money not to them, not to economic growth, not to opportunities, but back to its proxies, back to its nuclear program, back to its weapons program,” Bitsoff said.

But she stopped short of arguing that economic pressure can determine the Islamic Republic’s political future. Instead, she said sanctions can help establish the conditions in which other forces operate, with political change ultimately depending on Iranians themselves.

“The Iranian people are the ones that have to use that pressure,” Bitsoff said, adding that alongside sanctions, the United States should be “thinking of any possible way we can support that.”

The resignation of Mohammad Bagher Zolghadr, the former deputy commander-in-chief of the Islamic Revolutionary Guard Corps (IRGC), from the SNSC positions his tenure as secretary as the shortest in the history of the Islamic Republic.

Zolghadr was demoted, becoming a political advisor to the supreme leader. Rezaei's appointment demonstrates both the militarization and fragmentation of the Islamic Republic’s elite.

The careers of Rezaei and Zolghadr have multiple parallels. Zolghadr served under Rezaei when he was commander-in-chief of the IRGC. Zolghadr was Rezaei’s chief of the IRGC’s joint staff.

Both men later became secretary of the Expediency Council, which advises the supreme leader and arbitrates disputes between parliament and the Guardian Council, after their long tenures in the IRGC’s top brass. The Expediency Council has traditionally been used by Iran’s supreme leaders as a landing spot for the old guard after service in more consequential positions.

The return of these figures to Iran’s top ranks reflects the hollowing out of the Islamic Republic’s military leadership following US and Israeli airstrikes in 2025 and 2026.

This is not Rezaei’s first stint on the SNSC. As commander-in-chief of the IRGC, he served as an SNSC member. But the last time he was officially part of its deliberations was in 1997.

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In becoming secretary of the SNSC, he is the first former IRGC commander-in-chief to serve as secretary. He joins Ahmad Vahidi, the current IRGC chief, who was Quds Force commander under Rezaei’s tenure at the helm of the Guards, who holds a seat on the SNSC.

Rezaei also has a long history with another SNSC member Speaker of Parliament Mohammad Bagher Ghalibaf, who rose through the ranks of the IRGC—as deputy commander of the fearsome Basij and commander of the Khatam al-Anbiya Construction Headquarters—under Rezaei’s leadership. In 1997, when Rezaei departed from the IRGC’s top position, Ghalibaf signed a letter to Rezaei praising him as a “mentor.”

Both Ghalibaf and Rezaei have also been political rivals, unsuccessfully running against each other as candidates for president, for example in 2013. With a supreme leader who has largely been inaccessible and invisible to most in Iran, this sets-up the prospect of clashes within the SNSC, especially as both men have seen themselves as destined for higher office.

Like Zolghadr, Rezaei is also a hardline actor. But Rezaei has exhibited more political competitiveness than his predecessor, having run for office whereas Zolghadr spent most of his career embedded in military and security institutions.

Ghalibaf, however, could be bolstered on the SNSC with the appointment of Ali Abdollahi as chief of staff of Iran’s Armed Forces. Abdollahi served as a longtime deputy of Ghalibaf, when Ghalibaf headed the IRGC’s Air Force and Iran’s Police. Therefore, while Rezaei’s appointment can be seen as a check on Ghalibaf, the latter is not necessarily losing his influence.

Rezaei’s appointment as SNSC secretary is also likely a blow to President Masoud Pezeshkian. Traditionally, despite presidential decrees appointing the SNSC secretary, in practice, the supreme leader decides the fate of the position.

Given Rezaei’s being a longtime fixture in conservative politics in Iran, it can be safely assumed that he was not the reformist Pezeshkian’s first choice for the position. These dynamics further marginalize Pezeshkian and his Foreign Minister Abbas Araghchi. Just days ago, Iranian media reported that Pezeshkian had refused Zolghadr’s resignation as SNSC secretary.

Rezaei’s views may also lead to disagreements with Pezeshkian’s camp, which is more focused on returning to the MOU than dragging negotiations out to build deterrence and achieve a better deal.

In a 2015 state television appearance, Rezaei proclaimed that “we’ll take 1,000 Americans hostage. America will have to pay several billions to get every single one freed. This is how we can solve our economic problems.”

Rezaei’s ascension continues the trend of the SNSC being populated by men steeped in asymmetric tactics against the United States, like terrorism. Zolghadr previously commanded the IRGC’s Ramadan Headquarters which later morphed into the Quds Force.

Rezaei oversaw a particularly active period of IRGC terror plots when he was leading the IRGC—for example the bombings of the Israeli embassy in Argentina in 1992, a Jewish community center in Buenos Aires in 1994, and Khobar Towers in Saudi Arabia which killed 19 American servicemembers in 1996.

INTERPOL issued a Red Notice for Rezaei at Argentina’s request over his alleged involvement in the 1994 AMIA bombing.

Vahidi also participated in the deliberations which led to these attacks and was likewise the suject of an INTERPOL Red Notice. Thus, Iran’s SNSC will now feature two men who are the subject of an INTERPOL Red Notice.

Before, especially under Ali Khamenei’s tenure, softer faces more palatable to the international community served as secretary. Now, the Islamic Republic is broadcasting the rogue nature of the regime—a signal of its overconfidence, which is dangerous.

This raises questions over Iran’s future trajectory with respect to developing nuclear weapons—especially as it’s using the tussle over the Strait of Hormuz as a shield from having to make concessions on its nuclear program.

When he was commander-in-chief of the IRGC, Rezaei was quoted in a 1988 assessment sent to Akbar Hashemi Rafsanjani and later relayed to then-Supreme Leader Ruhollah Khomeini as suggesting that nuclear weapons, among other arms, would be needed if Khomeini chose to continue the Iran-Iraq War, which was depleting the Iranian state.

He did recognize the limits of the Islamic Republic’s power at the time—reportedly telling Khomeini that “there are no victories forthcoming in the next five years” without such weaponry. Although, for now, Rezaei appears content with leveraging the Strait of Hormuz, dubbing Iran’s control over it “more important than dozens of nuclear bombs.”

In the end, Rezaei’s ascension may lead to growing disagreements within the Islamic Republic’s establishment. It also reflects the continued domination—which started before the war—of the IRGC in decision-making.

Rezaei’s predecessors as secretary of the pre-war SNSC, include Ali Shamkhani, who headed the IRGC’s Navy, and Ali Akbar Ahmadian, a longtime IRGC commander himself. Rezaei being elevated at this time is telling given his role in past crises during wartime.

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The debate comes amid speculation that the 60-day arrangement agreed with the United States could be extended by another 30 to 60 days, while Oman continues efforts to broker a temporary reopening of the waterway.

An ILNA report published less than a week before the deadline cited diplomatic sources as saying the atmosphere surrounding the talks had become more positive, though no final agreement had been reached.

The proposed arrangement would not constitute a broader political settlement, but a temporary de-escalation mechanism allowing commercial shipping to resume under monitored conditions.

One source described it as a “technical and security understanding,” with shipping lanes potentially restored in phases.

A ‘golden opportunity’

The possibility of even a temporary reopening has prompted debate in Tehran over how Iran should use what some commentators describe as a “60-day golden opportunity.”

Writing in the moderate Etemad newspaper, Hossein Salahvarzi argued that any easing of tensions would provide a narrow but valuable chance to stabilize trade after months of disruption.

Political de-escalation alone, he warned, would not restore normal commerce. Ships must be willing to enter the region, insurers must accept the risks, freight rates must fall and ports must be able to handle incoming cargo.

Salahvarzi urged authorities to prioritize imports of medicine, grain, livestock feed, critical spare parts and industrial inputs, warning that without clear planning, essential goods could remain stuck in bureaucratic queues until the window closes.

The argument reflects a wider sense of urgency in Iranian coverage, with any reopening increasingly portrayed as a temporary opportunity rather than the beginning of a durable return to normal trade.

ILNA similarly noted that even a short period of stability could reduce freight and insurance costs and ease pressure on essential imports.

Hardliners resist reopening

But the prospect of reopening Hormuz continues to face strong political resistance in Tehran.

Hardline lawmakers on Thursday dismissed the chances of arrangements negotiated with Omani and Pakistani intermediaries succeeding and insisted that the strait should remain closed.

Foreign Ministry officials have also publicly expressed doubts over whether the mediation will produce an agreement.

The competing positions expose a broader disagreement over how Iran should use its remaining leverage over Hormuz: whether to exploit a temporary opening to relieve pressure on its economy or preserve restrictions on shipping as a bargaining tool in negotiations with Washington.

ILNA said Oman had been mediating intensively on a temporary arrangement, while Persian Gulf Arab states, China and Pakistan were also pushing for de-escalation because of the disruption to regional trade.

“No country in the region benefits from a closed Hormuz,” the agency quoted a diplomatic source as saying.

Any agreement would nevertheless remain conditional and reversible, with deep mistrust between Tehran and Washington leaving it vulnerable to another military incident.

For those urging Tehran to seize the opportunity, that uncertainty is precisely the point. A temporary reopening would offer Iran a chance to replenish essential supplies and ease pressure on trade, but with little confidence that calmer conditions in the Persian Gulf will last.

The setting was routine government business: a signing ceremony between two ministries, with footage showing Araghchi alongside Health Minister Mohammad-Reza Zafarghandi. The headline strap announced an agreement between the ministries of health and, in Persian, khavarejeh, Kharijite affairs, instead of kharejeh, foreign affairs. The difference is a single letter vav. A screenshot was circulating within minutes.

Within hours, the strap was a national argument. "Abbas isn't the foreign minister anymore. He's the minister of the Kharijites now," one widely shared post said of the man leading Iran's talks with Washington.

Another user drew the lineage: "Zarif was America's foreign minister. This one turned out to be the Kharijites'." Mohammad Javad Zarif, the architect of the 2015 nuclear deal, spent years being mocked with that title by the broadcaster's favorite guests; to many, the strap was the same insult upgraded, from serving the enemy to heresy.

The reformist daily Etemad asked the question on everyone's screen: "Mistake or mischief?" One viral post refused the innocent reading outright: "With this budget, this many staff, editors, broadcast supervisors and layer after layer of managers, you don't get to say 'it was a typo.'" The post tagged Peyman Jebelli, the broadcaster's hardline chief.

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The deadliest word in the lexicon

The name Kharijites means "those who went out," and the story behind it is Islam's first civil war, remembered as the First Fitna. In 657 AD, at the Battle of Siffin, followers of Imam Ali, the first imam of Shia Islam, pressed him to accept arbitration with his rival Muawiya rather than fight on. When the arbitration went badly, the same men turned on Ali for accepting it, declared that "judgment belongs to God alone," walked out of his camp and made war on him. Ali crushed them at Nahrawan; three years later, a Kharijite assassin's poisoned blade killed him at prayer.

In the Islamic Republic's political language, no insult reaches deeper. "Kharijite" means the traitor within, the pious-faced insider who deserts the rightful leader, the author of fitna, the sedition that splits the faithful.

The late supreme leader Ali Khamenei's own commemorations dwelt on Nahrawan as the hardest of Ali's wars, fought against old companions whose foreheads were calloused from prayer, and his loyalists spent the years after the 2009 protests hanging the word on the opposition.

One user reached for exactly that memory this week, asking a government supporter: "So does your definition cover 2005 and 2009 as well?"

The alibi written into the alphabet

The typo has a linguistically respectable defense, which is part of what makes the episode so perfectly Iranian. Persian preserves a silent vav in a handful of ancient words, a fossil of pronunciation lost a thousand years ago: "sister" is written khvahar but said khahar. A typist's hand trained on those spellings could, in theory, plant the ghost letter in kharejeh on autopilot.

The defenders made that case. "It's a typo, not sabotage. Stop making a mountain out of a molehill," one wrote. Another blamed simple ignorance, at the establishment's expense: "Pure illiteracy at the mullahs' broadcaster. They figured if 'sister' takes the silent vav, 'foreign' must take one too."

The skeptics' answer was the broadcaster's record, which is where the story stops being about spelling.

A seminar, then a knife fight

What happened next may be the most Iranian part of all: the country fell into a theological flame war over the year 657, conducted in quote-tweets, as a proxy for a live question of war and peace.

One camp insisted the label fits the diplomats. "The Kharijites were the negotiation camp. That's the historical record," one post read. Another cast Araghchi in an even older role: "He's standing right where Amr ibn al-As stood, and his caliph is Muawiya," a reference to the silver-tongued arbitrator who outfoxed Ali's side at the table.

The rival camp threw the word back across the aisle. "The Kharijites were the ones pushing the imam into talks with the devil, and when it all went wrong, they blamed the imam," one wrote, a reading with a sharp contemporary edge, since hardline media have spent recent weeks portraying Supreme Leader Mojtaba Khamenei as having opposed the negotiating process that produced the Islamabad agreement.

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Another user completed the thought: "The Kharijites were inside Ali's own government. They kept pressuring him to negotiate, and when the whole thing blew up, they said: we had nothing to do with it."

Others turned the word on the broadcaster's own patrons: "If anyone here fits the Kharijites, it's Jalili and his gang. Extremism is all they've got." A government supporter fired back: "If only you people read some history. The Kharijites were the ones with no seat at the table, endlessly kicking at the government of the day to get one. Exactly like you."

• 

  Hardliners accuse negotiating team of ignoring Supreme Leader's objections

And beneath the seminar, a threat. One account declared "the Kharijites' coup is near," amplifying a post that urged toppling President Masoud Pezeshkian's government before, it said, the government topples the system.

The broadcaster with a record

The reason so few Iranians extend the benefit of the doubt is that the strap did not appear on a neutral screen.

The Islamic Republic of Iran Broadcasting is run by Jebelli and his cultural deputy Vahid Jalili, the brother of Saeed Jalili, the hardline politician who styles his circle a shadow government, and it has spent months in open warfare with the state's own diplomats.

In recent weeks alone, the broadcaster censored Pezeshkian's disclosure that the late supreme leader had privately ordered officials to negotiate with Washington while publicly ruling talks out; cut short a live interview with parliament speaker and chief negotiator Mohammad Bagher Ghalibaf; ignored a formal order from its own supervisory board to stop censoring senior officials; and answered a complaint from Araghchi with a sneer that it could not give him "24/7 coverage."

The timing gives the letter a forward edge. Jebelli's five-year term expires within weeks, and whether the new supreme leader reappoints the current management has become an early test of the postwar balance between the war camp and the talks camp.

A one-letter insult to the chief diplomat, aired on Jebelli's channels while his renewal hangs in the balance, is either spectacular carelessness or a message about who does not fear the outcome.

One establishment, two masks

A caution belongs here, and some Iranians supplied it themselves. The fight between the broadcaster and the diplomats is real enough to produce casualties, but the moderate-versus-hardliner frame is also the Islamic Republic's most exportable fiction; every actor in this drama supports the system, and the menace of one camp has always been useful to the bargaining of the other.

As one user put it: "It's an open division of labor. America and Israel attack from the outside, the Ahmadinejad crowd and the shadow government undermine from the inside."

A typo that cannot be proven deliberate is the perfect weapon for a factional war that cannot be proven real.

In Persian, the silent vav is written but never pronounced. On Iranian state television, it was the only letter that spoke.

Tehran’s drive to turn that control into lasting economic and political leverage—through shipping routes, mine clearance and potentially revenues from passing vessels—is emerging as a major obstacle to extending its fragile memorandum with the United States, which expires Sunday.

Washington, meanwhile, increasingly claims it has broken Iran’s control of Hormuz.

The June 18 memorandum is formally due to expire on August 16. President Donald Trump pronounced it over after Iran attacked three ships in the Strait of Hormuz, ordering more strikes and the resumption of the US maritime blockade.

Neither side, however, has formally abandoned diplomacy. If no extension is announced before Sunday, the current state of neither war nor peace could continue. An explicit declaration that the arrangement has ended could increase the risk of renewed attacks.

‘More valuable than a nuke’

Pressure against concessions over the strait is also growing inside Tehran.

Parliament’s National Security and Foreign Policy Commission this week unanimously approved the broad outlines of legislation that would tighten Iran’s control over Hormuz.

The bill includes provisions for inspecting vessels in Iranian territorial waters, banning the passage of assets, equipment and vessels belonging to the United States, Israel and other countries Tehran deems hostile, and charging ships for maritime services.

If enacted, the legislation could constrain Tehran’s room for compromise, much as legislation passed during Hassan Rouhani’s presidency required his government to increase uranium enrichment and suspend implementation of the Additional Protocol unless banking and oil sanctions were lifted.

Alireza Salimi, a member of parliament’s presiding board, told the ISNA news agency Thursday that “the Strait of Hormuz is currently more valuable to Iran than an atomic bomb,” describing it as leverage for lifting sanctions and securing compensation for wartime losses.

Demands put talks in doubt

The tougher approach was also reflected in demands laid out shortly before his departure by Mohammad Bagher Zolghadr, the former secretary of the Supreme National Security Council.

Zolghadr said reopening the strait would require an end to attacks on Iran and its allies, the lifting of the blockade, the withdrawal of US forces from around Iran, sanctions relief, the release of frozen Iranian assets and compensation for damage caused by the wars.

It remains unclear whether those demands represented his personal position or that of the SNSC, and whether his successor, Mohsen Rezaei, will pursue the same approach.

Rezaei’s appointment this week, along with other changes at the top of Iran’s security establishment, has been welcomed by hardline opponents of the government’s approach to negotiations.

Former diplomat Kourosh Ahmadi wrote in the Shargh newspaper that if Tehran insisted on the conditions outlined by Zolghadr, “it is highly unlikely that there will be any serious negotiations between Tehran and Washington at all.”

Both sides claim control

The dispute is unfolding as Tehran and Washington offer directly competing accounts of who actually controls Hormuz.

Trump said Wednesday that the United States had complete control of the waterway and that the maritime blockade had deprived Iran of the ability to act.

The spokesman for Iran’s Khatam al-Anbiya Central Headquarters, the country’s wartime command center, rejected that assertion Thursday, saying the strait remained under Iranian control and that no vessel could pass safely without authorization from Iran’s armed forces.

Shipping-monitoring data show traffic remains a fraction of pre-war levels. Around 10 to 12 vessels have been crossing the strait daily in recent days, compared with roughly 130 to 140 before the war, with most currently using a route designated by Iran.

Tehran has also stressed that an agreement with Oman over shipping routes would not by itself be sufficient to reopen the strait.

Ali Gholhaki, a political activist close to parliament speaker and senior Islamabad negotiator Mohammad-Bagher Ghalibaf, said Iranian decision-makers currently had no intention of reopening the waterway and had blocked an agreement with Oman because of what they viewed as Muscat’s alignment with Washington.

Tehran and Muscat at odds

The disagreement with Oman offers perhaps the clearest illustration of what Tehran now wants from its control of Hormuz.

Iran has pushed for control over shipping routes and mine clearance and for mandatory payments from vessels using the waterway. Oman has instead favored a joint fund supported by voluntary contributions from governments and companies benefiting from shipping.

Few in Tehran expect Muscat to accept Iran’s terms. Ahad Azadikhah, a lawmaker aligned with Ghalibaf, recently told Khabar Online that if Oman did so, the Islamic Republic would have achieved “the victory of all victories.”

The dispute means Hormuz is increasingly intertwined with the fate of the wider Tehran-Washington dialogue. As Iran seeks to turn control of the strait into leverage over sanctions, compensation and any broader settlement, Washington may increasingly see that same leverage as something that must be neutralized before a deal can be reached.