Donald Trump has declared that the United States has “total control” over the Strait of Hormuz. “It belongs to us,” he said, adding that Iran would be “wiped out” if it acted against American interests. The rhetoric is spectacular. The reality is much less clear. The Strait of Hormuz has become the central strategic asset of the conflict between the United States and Iran, not because either side fully controls it, but precisely because neither side does. Washington can project military power across the region. It can escort vessels, strike coastal installations, enforce a naval blockade on Iranian ports and attack ships it considers to be violating that blockade. Iran, however, retains geography, proximity and the ability to threaten commercial shipping through missiles, drones, mines and direct interdiction. That is the contradiction at the heart of the current confrontation. The United States may dominate the military balance. Iran still controls much of the operational risk. And for markets, operational risk matters more than political declarations.

Before the war, roughly one-fifth of global oil and LNG flows passed through Hormuz. Since then, traffic has been severely disrupted, although not completely stopped. Tankers continue to cross, often through shuttle arrangements, night-time transits or ship-to-ship transfers outside the Strait. The system is functioning, but badly. This is not free navigation. It is improvised navigation under military pressure. The latest negotiations therefore matter considerably. Pakistan and Qatar continue to act as intermediaries, while talks between Iran and Oman appear relatively advanced. Tehran has suggested that an agreement over a temporary shipping route may be close. But the details remain more important than the announcement. Iran has made clear that any agreement over the management of Hormuz should not automatically be interpreted as a full reopening of the Strait. This distinction is fundamental. Tehran wants much more. Its conditions reportedly include the lifting of the US naval blockade, the release of frozen Iranian assets, sanctions relief, an end to hostilities and compensation for war damage. Iran has also demanded broader guarantees regarding attacks against groups it supports across the region.

Washington, meanwhile, is adding conditions of its own, including compensation for victims of attacks linked to the Iranian regime. This is not a negotiation over shipping lanes anymore. It is becoming a negotiation over the political settlement of the entire conflict. And that makes a quick agreement considerably more difficult. The problem is sequencing. The United States appears to want Iranian compliance first, followed by economic concessions. Iran wants American concessions first, followed by meaningful negotiations. This is exactly the type of diplomatic structure that can remain frozen indefinitely because each side demands that the other move before it does. The recent appointment of Mohsen Rezaee as head of Iran’s Supreme National Security Council reinforces that concern. Rezaee is not a technocrat brought in to engineer compromise. He is a former commander of the Islamic Revolutionary Guard Corps and a long-standing advocate of Iranian strategic autonomy. His appointment suggests that Tehran continues to view control over Hormuz as a strategic asset rather than simply a logistical question. That interpretation matters because Iran has already paid an enormous economic price. Its economy is under severe pressure. Inflation has reportedly surged to extraordinary levels, its currency has weakened, energy exports have been disrupted, and industrial capacity has been damaged.

Trump is clearly betting that time works in Washington’s favour. Instead of immediately escalating militarily, he has increasingly emphasised economic pressure. That may explain the apparent contradiction between his language and his actions. The rhetoric remains maximalist. The strategy is becoming more patient. Washington can afford to wait if it believes Iran’s economic position will deteriorate faster than its own political tolerance. But Iran has its own source of leverage. Hormuz. As long as Tehran can make the Strait unreliable, it can export part of its economic pain to the rest of the world. Higher freight costs, higher insurance premiums and the threat of energy disruption create pressure far beyond Iran itself. This is why Brent continues to trade close to USD 90 per barrel despite repeated suggestions that an agreement may be near. Markets understand that an announcement is not the same thing as normalisation.

Even if Iran and Oman agree on a temporary shipping corridor, the key questions remain unresolved. Who controls the route? Who authorises passage? Will there be fees? Who guarantees security? Will the US blockade be lifted? And what happens when the temporary arrangement expires? Until these questions are answered, shipping companies will continue to price risk conservatively. This has wider implications. The Middle East energy system is no longer operating around one secure corridor. Saudi Arabia has increasingly redirected exports towards the Red Sea, only to face renewed Houthi attacks. The United States has provided military assistance for shuttle operations through Hormuz. Tankers are transferring crude offshore. Freight rates have risen dramatically, with some Middle Eastern tanker hire costs reaching extreme levels. The world has therefore developed workarounds. But workarounds are not resilience. They are expensive substitutes for normality. And that cost eventually appears somewhere else: in oil prices, refined products, insurance premiums, transport costs and inflation. This is why Trump’s assertion of “total control” should be treated carefully. Military superiority and economic control are not the same thing.

A temporary maritime arrangement could therefore emerge. But investors should distinguish between a tactical deal and a strategic settlement. A temporary corridor would reduce the immediate risk premium. It would not resolve the underlying conflict. The nuclear question remains open. Sanctions remain unresolved. The US naval blockade remains contested. Iran’s regional network continues to operate. And both sides fundamentally disagree over who has legitimate authority in the Strait. That means volatility will remain part of the landscape. The most likely outcome is therefore neither American control nor Iranian control. It is managed instability. Enough navigation to prevent an economic catastrophe. Enough disruption for Iran to preserve leverage. Enough military presence for Washington to claim deterrence. And enough uncertainty to keep energy markets permanently nervous. Trump may say that Hormuz belongs to the United States. Iran may insist that it controls the Strait. The truth is less comfortable. For now, Hormuz belongs to neither. It belongs to risk.