NEED TO KNOW

• Qatar and Oman strike separate deals with Tehran amid ongoing Iran war
• Iran and Oman drafting protocol to oversee Strait of Hormuz transit
• Qatar reportedly reaches deal to recover funds deposited in Iranian banks

DOHA/MUSCAT (TDR) — Qatar and Oman have struck separate deals with Tehran as the Iran war continues, signaling a shift in Gulf diplomacy that bypasses Washington and establishes direct arrangements with the country the U.S. and Israel are actively bombing.

The big picture: The agreements represent a pragmatic recognition by Gulf monarchies that their economic survival depends on stable relations with Iran—even as the U.S. pursues military operations that have disrupted regional energy flows and threatened their security.

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• Iran and Oman are drafting a protocol to oversee maritime transit through the Strait of Hormuz, according to Iranian Deputy Foreign Minister Kazem Gharibabadi
• Qatar has reportedly reached a deal with Tehran to return money deposited in Qatari banks, though details remain opaque
• The moves come as Iran has allowed vessels from "friendly countries" including India, China, Russia, and Pakistan to transit Hormuz while blocking U.S.-linked shipping

Why it matters: The bilateral arrangements undermine the U.S. strategy of isolating Iran economically and militarily, while giving Tehran leverage to maintain Hormuz as a "toll booth" even after the war ends.

• Iran has effectively monetized the strait, with reports of $2 million tolls for passage and potential monthly revenue exceeding $800 million
• The Oman protocol could formalize Iranian control over the waterway, with Gharibabadi stating "Only Iran and Oman will decide the future of the Strait of Hormuz"
• Qatar's deal to recover bank deposits suggests economic normalization even as the U.S. maintains sanctions

Driving the news: The Gulf states are pursuing independent diplomatic tracks as the U.S. war effort faces mounting challenges and European allies distance themselves.

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• Iranian officials stated the Oman protocol aims to "facilitate and ensure safe passage" though Gharibabadi insisted "wartime conditions cannot be governed by peacetime rules"
• India purchased its first shipment of Iranian LNG in March after resuming energy cooperation suspended since 2019
• The deals follow Iranian strikes on GCC countries that prompted a UN Security Council resolution condemning Tehran

What they're saying: Iran frames the agreements as legitimate security measures, while the U.S. warns against legitimizing Tehran's control over international shipping.

• Kazem Gharibabadi, Iranian Deputy Foreign Minister — "We are drafting a protocol for Iran and Oman to supervise transit in the Strait of Hormuz"
• Iranian Embassy in New Delhi — "Our Indian friends are safe, do not worry. Only Iran and Oman will decide the future of the Strait of Hormuz"
• U.S. Secretary of State Marco Rubio has called Iran's toll system "illegal, unacceptable, and dangerous"

Yes, but: The Gulf states face an impossible choice—aligning with the U.S. military campaign risks economic catastrophe, while dealing with Iran preserves their survival but undermines regional security arrangements.

• Qatar and Oman have historically maintained neutral stances, with Oman serving as a back-channel mediator between Iran and Western powers
• The UAE and Saudi Arabia have been directly targeted by Iranian strikes, complicating their diplomatic options
• European and Asian allies meeting Thursday failed to agree on specific steps to pressure Iran over Hormuz

Between the lines: The deals suggest Gulf monarchies are preparing for a post-American regional order, where their security depends less on U.S. guarantees and more on direct accommodation with Iran—regardless of who "wins" the current war.

• The Oman protocol could establish a permanent Iranian role in managing Hormuz, setting a precedent for coastal state control over international straits
• Qatar's financial deal with Iran mirrors its 2023 mediation that secured prisoner releases and unfroze $6 billion in Iranian funds
• These arrangements may outlast the current conflict, fundamentally altering regional power dynamics

What's next:

• The Oman-Iran protocol details remain under negotiation, with no timeline for implementation
• U.S. officials are expected to pressure Gulf allies to reject arrangements that legitimize Iranian control over Hormuz
• India and other "friendly" nations may seek formalized transit agreements with Tehran

If Gulf states conclude that their interests are better served by dealing directly with Iran than relying on U.S. protection, what does that mean for the future of American influence in the region—and does it signal that military dominance is becoming less relevant than economic pragmatism in Middle East diplomacy?

Sources

This report was compiled using information from Intellinews, Anadolu Agency, TASS, Kavout, Security Council Report, and NPR.

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