Trump’s Iran compensation demand clouds Hormuz reopening talks

WASHINGTON: Prospects for an agreement to reopen the Strait of Hormuz have weakened after US President Donald Trump called for Iran to pay compensation for deaths and damage linked to conflicts, attacks and protests.

Trump’s demand came in response to conditions put forward by Tehran as part of efforts to reach a broader peace agreement. Iran had called for compensation and an end to US sanctions, with Foreign Minister Abbas Araqchi saying earlier that Tehran and Oman were close to an understanding on a new arrangement for shipping through the strategic waterway.

Speaking at the White House on Monday, Trump said Iran should compensate those affected by decades of conflict and referred to deaths involving civilians and US forces in the region.

“We’re going to ask for money for the damage they’ve done over a 50-year period,” Trump said.

The demand was not previously part of the negotiations and could further complicate efforts to revive a deal between Washington and Tehran.

Iran’s conditions have broadly reflected elements of a preliminary peace agreement reached in June, but that arrangement has since collapsed amid continued tensions.

Since the conflict began in February, Trump has alternated between warnings of further escalation and assertions that an agreement with Iran could be reached soon.

The Strait of Hormuz, through which a significant share of global oil supplies passes, has remained largely closed during the conflict, disrupting energy markets and international shipping.

Oil prices ended about 5% higher on Monday as the latest US demands reduced expectations of a near-term agreement to restore shipping through the waterway.

Trump cites attack blamed on Al Qaeda, not Iran

Referring to Tehran’s crackdown on demonstrations in late 2025 and 2026, Trump said Iran had killed some 52,000 protesters as of six weeks ago. While some Iranian opposition and exile groups have claimed tens of thousands killed, the U.S.-based Human Rights Activists News Agency (HRANA) in February reported around 7,000 deaths including 6,500 protesters.

Trump encouraged protesters to overthrow the Iranian government when the war began with U.S. and Israeli airstrikes in February. Rights groups say the Iranian government has continued to crack down on opponents since then.

Trump also said Iran should compensate families of the 17 U.S. sailors killed in an October 2000 attack in Yemen on the naval vessel USS Cole, which has been blamed on al Qaeda, not Iran.

“Also, with respect to the Iran negotiations, Iran should be responsible for the damages and death caused to the people of Lebanon, Syria, Yemen, and Gaza!” Trump wrote in a Truth Social post.

Iran earlier said it was nearing a final pact with Oman defining new shipping lanes between them through the Strait of Hormuz but repeated that the U.S. must meet conditions, including compensation and an end to sanctions and military threats before the key waterway is reopened.

The strait, through which about a fifth of global oil and liquefied natural gas flowed prior to the conflict, has been effectively blocked since the war began, pushing up oil prices and inflation.

Trump under pressure

Ironically, the agreement with Oman would give Tehran more leverage over the key waterway than it had before the war began.

Trump is under pressure to end a war that is deeply unpopular at home ahead of midterm elections in November, and high fuel prices are a top issue in rural areas that have backed him in the past.

“What you’re seeing here is the beginning of a capitulation,” Democratic U.S. Representative Bill Keating said on CNN. “This is reality. It’s sinking in.”

Earlier on Monday, Iranian Foreign Ministry spokesman Esmaeil Baghaei said talks with Oman were “progressing smoothly and constructively”, with an agreement reached on a shipping route map, while some technical issues remained unresolved.

Baghaei said the discussions also covered services which would normally involve payment, such as safe navigation, environmental protection, maritime services and combating crime.

U.S. officials have repeatedly ruled out any deal that would allow Tehran to charge fees for access to the strait.

But months of U.S. military efforts, including a two-week campaign of strikes in July, have not broken Iran’s grip on the strait, despite Trump’s misleading claim, repeated on Monday, that the strait was open and, “The only one that has control of the Strait of Hormuz right now is the United States Navy.”

Washington and Tehran agreed to a ceasefire in June, but the U.S. reimposed a blockade on Iranian shipping in July, a move that Tehran said violated the truce.

Iran has been striking back with missiles and drones against Washington’s allies in the region, while also targeting commercial ships transiting the strait without its permission.