US and Iran explore phased deal to reopen Hormuz and lift blockade

US and Iranian negotiators in New York are exploring a phased deal to end their nearly seven-month conflict, involving Tehran reopening the Strait of Hormuz and Washington lifting its economic blockade of Iran, sources said. The talks face a major obstacle as neither side wants to surrender leverage first, though Iran recognizes the economic cost of prolonged confrontation. A senior Iranian official proposed a staged arrangement, with Iran allowing navigation in return for blockade relief and potential access to frozen assets. A White House official said President Donald Trump holds a strong position, with sanctions and the blockade crippling Iran's economy, and remains open to talks but content to let an "inevitable Iranian collapse" play out. Former US negotiator Dennis Ross estimated only a 30% chance of a pre-midterms deal, noting both sides may have stronger incentives to negotiate before the November 3 vote.