Oil tumbles as US signals Hormuz deal may be imminent

This live blog follows the latest developments across the Middle East crisis, including regional diplomacy, maritime security, ceasefire negotiations, and economic fallout.

Catch up on Tuesday's top developments here:

• Qatar, Egypt, Turkey condemn Israel over Gaza 'violations'
• Iran thanks Pakistan for support during conflict with Israel and US

• Global markets climb while oil prices bounce back from sharp falls

• Qatar blames Israel for delayed implementation of Gaza peace plan

• US Treasury Secretary says chance of Hormuz deal with Iran by Wednesday

Tuesday's developments at a glance

Published: Aug 4, 2026 | 00:00 GMT | by AFP

A possible US-Iran deal to reopen the Strait of Hormuz dominated Tuesday's developments, with senior US officials saying Washington and Tehran could reach an agreement within days as diplomatic efforts intensified to ease tensions and restore freedom of navigation through the strategic waterway.

US Treasury Secretary Scott Bessent said there was a chance of reaching a deal by Wednesday, while Secretary of State Marco Rubio said talks involving Oman and Iran had made progress on ensuring safer passage for ships, although no final agreement had been reached.

Qatar said Pakistan and Oman were continuing efforts to facilitate engagement between Iran and the United States and help bridge differences. Doha said regional mediators were working to contain the escalation and revive diplomatic efforts, while stressing that there were no direct US-Iran talks at present.

Iran also thanked Pakistan for its support during its recent conflict with Israel and the United States, praising Islamabad's diplomatic efforts to promote dialogue and mediation.

The developments around Hormuz had an immediate impact on global energy markets. Oil prices fell around 5% after US officials expressed optimism over a possible deal, with West Texas Intermediate dropping to $76.32 a barrel and Brent crude falling below $80. Prices later recovered some ground as conflicting statements from Washington and Tehran kept investors cautious.

The Strait remained a major focus for oil markets, with maritime tracking data showing that more than 30 million barrels of Iraqi crude passed through the waterway between July 4 and August 4.

Global financial markets meanwhile advanced, with the Dow Jones Industrial Average rising 1.3% to a record 53,178.41. Asian and European markets also broadly gained amid easing concerns over energy supplies.

Elsewhere in the region, US-facilitated talks between Israel and Lebanon began in Rome and are scheduled to continue through August 6. The talks are focused on implementing a framework covering Hezbollah's disarmament, the redeployment of Israeli forces from southern Lebanon and the deployment of Lebanese forces in designated areas.

Hezbollah leader Naim Qassem criticized the negotiations, saying direct talks with Israel would bring "shame and humiliation" to Lebanon.

The Gaza situation also remained in focus. Qatar blamed Israel for delays in implementing a Gaza peace plan, while Qatar, Egypt and Türkiye condemned what they described as continuing Israeli violations in the Palestinian territory, including attacks on health facilities and civilian infrastructure.

Hamas called for clarification from US President Donald Trump's Board of Peace over statements concerning its disarmament and Israel's withdrawal from Gaza, saying the statements did not adequately address Israel's obligations under the proposed arrangement.

In another regional development, Yemen's Houthis claimed a drone attack targeting Najran Airport in southern Saudi Arabia. Saudi Aramco Chief Executive Amin Nasser said Houthi attacks had caused no material impact on the company's production.

Saudi Aramco reported a 44% year-on-year increase in second-quarter net profit to $32.7 billion, while British energy giant BP posted a net profit of $3.91 billion, as major energy companies benefited from volatile oil and gas markets linked to the Middle East conflict.

For earlier developments, read our Aug 4 live blog here