Iran and US Trade New Demands in Hormuz Talks: What It Means

The United States and Iran have exchanged new demands in negotiations over reopening the Strait of Hormuz, raising doubts about the prospects for a broader agreement to end the five-month war between the two nations.

According to Al Jazeera, while the US claims to be directly involved in the talks, Iran says it is negotiating only with Oman — the country Tehran has proposed to co-manage the vital waterway in the future. Before the US-Israel war on Iran began in late February, the Strait of Hormuz carried one-fifth of the world's crude oil and liquefied natural gas.

On August 11, US President Donald Trump announced he would demand compensation from Iran for deaths and injuries linked to decades of conflicts and attacks. The statement came after Iran last week presented new conditions, demanding war reparations and insisting it would not reopen the strait until Washington meets its political and economic demands.

Analysts say broader peace talks between the two countries are unlikely to resume until the Strait of Hormuz issue is resolved.

Trump's 'compensation' demands

Trump said Iran should pay reparations for those who died or were seriously injured due to Iran's actions. "We will be asking for money for the damage they have done over the last 50 years," Trump told reporters at the White House.

On Truth Social, the US leader also demanded Iran compensate the families of 17 American sailors killed in the October 2000 attack on the USS Cole destroyer in Yemen — an incident attributed to al-Qaeda, not Iran. He also suggested compensation for the families of Iranian protesters killed during anti-government unrest in January.

"Additionally, regarding negotiations with Iran, Iran should be held accountable for the damage and deaths caused to the people of Lebanon, Syria, Yemen, and Gaza!" Trump wrote.

Trump's demand came after Iran said the US should compensate Tehran for damages from US and Israeli attacks during this year's war. The president's escalatory statement appears to contradict Vice President JD Vance, who on August 9 expressed confidence in reaching a deal with Iran. Vance also said Iran had told the US it had "no plans" to impose tolls on the Strait of Hormuz.

Oil prices rose more than 5% on August 11 following Trump's new demands and continued to climb on August 12 as hopes for a deal faded.

Iran's new conditions

Iran says the reopening of Hormuz — which was largely closed to shipping shortly after the war began — depends on Washington taking several steps, including agreeing to new conditions.

Six new conditions announced by Iran's Supreme National Security Council on August 9 include:

• An end to US threats and insults against Iran;
• A permanent end to attacks on Iran and its allies in Lebanon, Palestine, Yemen, and Iraq;
• Lifting the US naval blockade on Iranian ports and withdrawing US naval and air forces from the area around Iran;
• Compensation for damages from two "imposed wars" — including the war that began on February 28 and the 12-day war with Israel in June 2025 in which the US also participated;
• Lifting sanctions;
• The unconditional release of Iran's frozen assets.

Tehran also said negotiations with Oman on a new shipping agreement for the Strait of Hormuz are in their "final stage." Foreign Minister Abbas Araghchi reiterated on August 10 that there are no direct talks with the US, but messages are exchanged through intermediaries.

Impact on peace process

The negotiating stances of the US and Iran on the Strait of Hormuz are hardening, raising doubts about the possibility of a diplomatic breakthrough for a broader peace deal, according to analyst Negar Mortazavi, a senior fellow at the Center for International Policy.

"Both sides seem to be making maximal demands before serious negotiations," Mortazavi said. "Trump's new demands are particularly troubling because they bring in issues beyond ending the current conflict. If compensation for protests and past events becomes a real US condition for a deal, Tehran will find it extremely difficult to accept."

Tehran previously said it lost trust in US negotiators because Washington launched attacks on Iran three times while previous talks were ongoing.

Tehran-based political analyst Hossein Royvaran said the outcome of the Hormuz standoff will depend on which side has greater endurance. "The current equation is: closure vs. blockade. But the question is, who cries for help first?"

"Right now, the US is suffering: gas prices, inflation, the cost of living rising. There is deep discontent in America over this war. The same is true in Iran, though here society has acceptable justification: that the war was imposed on Iran and Iran had no choice but to defend itself," Royvaran said.