Trump Abandons Iran MOU, Hormuz Negotiations Stalled, Oil Risks Rise

The Trump administration has informed mediators it has no interest in returning to the June memorandum of understanding (MOU) with Iran, according to the Wall Street Journal. This has effectively ended the framework for restarting negotiations on reopening the Strait of Hormuz, causing oil prices to surge above $88 per barrel. The provisional agreement, signed at Versailles with JD Vance's mediation, aimed to reopen the strait and begin nuclear talks in exchange for sanctions relief. It collapsed within weeks after Iran attacked ships, prompting Washington to adopt a maximum economic pressure policy. Iran's IRGC has also taken a hardline stance, demanding the US accept its conditions for reopening the strait. A week of shuttle diplomacy has failed, with Pakistani and Omani mediators making little progress. The US launched "Operation Economic Outcast" on August 25, sanctioning 60 entities and expanding secondary sanctions across five sectors. Tanker traffic remains well below normal levels, and Friday marks six months since the initial attack on Iran.