The 60-day deadline for the United States and Iran to reach a permanent peace agreement expired Monday, August 17, with the two governments still divided over the Strait of Hormuz and no sign that detailed nuclear negotiations have begun.

A senior Iranian official told Reuters that Tehran had decided to move from a defensive policy to a more offensive posture if Washington failed to implement the June framework within weeks. The statement was a warning attributed to an unnamed official, not confirmation that Iran had launched a new attack.

The immediate dispute centers on who manages shipping through the strait and when the United States lifts its blockade of Iranian ports. Iran said Monday that it had reached an understanding with Oman on the map of a transit route, but the details were still being finalized and Washington had not publicly accepted the plan.

What changed

The June memorandum called for military operations to stop, commercial shipping to resume and the two sides to negotiate a final settlement within 60 days. That framework quickly eroded as attacks on vessels, U.S. strikes on Iran and Iranian retaliation resumed. Both governments accused the other of violating the agreement.

On Monday, The Associated Press reported that the countries were farther apart than when the negotiating period began. President Donald Trump also said the deadline was not controlling and that there was no fixed timeline, according to AP, leaving the diplomatic process open but without a new agreed schedule.

Why Hormuz matters beyond the region

The Strait of Hormuz is the main sea outlet for Persian Gulf energy producers. The U.S. Energy Information Administration estimates that about 20 million barrels of oil per day moved through it in 2024, equal to roughly one-fifth of global petroleum consumption. Around one-fifth of global liquefied natural gas trade also used the route.

Markets are already reacting to the uncertainty. Brent crude rose 2.7% Monday to $90.87 a barrel, while major U.S. stock indexes declined and Treasury yields moved higher, AP reported. Higher energy costs can flow into transportation, food, manufacturing and inflation far beyond the Middle East.

What remains uncertain

  • Iran and Oman have not published the final terms of their proposed shipping arrangement.
  • The United States and Iran have not announced a formal extension of the June negotiating window.
  • Reuters' report describes an Iranian policy shift, but no public order setting out a new campaign was independently confirmed Monday.
  • It remains unclear when full, reliable commercial traffic through the strait could resume.

What happens next

The next signals will be any joint Iran-Oman transit statement, a formal U.S. response, changes in tanker traffic and whether Pakistan, Qatar or other mediators can restart direct negotiations. Military action around the strait would raise the risk of a broader regional confrontation; a verified shipping agreement could lower immediate pressure even without resolving the nuclear dispute.

The deadline's expiration does not automatically restart full-scale war. It does, however, remove a key diplomatic milestone while the world's most important energy chokepoint remains contested.