For seven months, the war between the United States and Iran has threatened to become something much larger than a regional conflict.
Now, diplomacy is making another attempt to stop it.
U.S. and Iranian officials separately engaged with mediators on September 28 as both sides explored a possible path toward ending the war, according to Reuters. The discussions are expected to focus on an amended version of a seven-day proposal put forward by Iran during the United Nations General Assembly in New York.
But beneath the diplomatic language sits an enormous strategic question:
Who controls the conditions under which the Strait of Hormuz reopens?
That question matters because Hormuz is not simply another waterway. It is one of the world's most important arteries for global energy markets.
And Iran is now tying its reopening directly to the terms of a possible settlement.
Iran's proposal
Iranian Foreign Minister Abbas Araqchi, who remained in New York after the UN General Assembly, said Tehran was waiting for Washington's response to its proposal.
Iran's position is straightforward: it says the Strait of Hormuz can reopen after the United States lifts its blockade and ends hostilities, while Tehran has also demanded the unfreezing of Iranian assets and relief from sanctions.
In return, Iran would allow maritime traffic through the strategically important waterway and resume negotiations concerning its nuclear program.
That is not simply a ceasefire proposal.
It is a package in which military de-escalation, sanctions, frozen assets, maritime access and nuclear negotiations are connected to one another.
The United States has not accepted those terms.
President Donald Trump said American officials had spoken with mediators and indicated that further negotiations were possible. But Washington has also rejected Iran's previous proposal and continued to emphasize the nuclear issue.
The result is a diplomatic process in which both sides are talking while still disagreeing over the fundamental price of peace.
Why Hormuz matters so much
The Strait of Hormuz connects the Persian Gulf with the Gulf of Oman and the wider Arabian Sea.
Its geographic importance is enormous.
Major oil and gas producers including Saudi Arabia, Iraq, Kuwait, Qatar and the United Arab Emirates rely heavily on the waterway to reach international markets.
That means a prolonged disruption can quickly become a global economic problem.
When ships carrying energy cannot move normally, traders price in the possibility of shortages.
Oil prices rise.
Higher oil prices can then increase the cost of transportation, aviation, manufacturing and electricity.
Those costs can eventually reach consumers through higher prices.
This is why a military conflict thousands of kilometres away can affect motorists, airlines, factories and households around the world.
The economic pressure is already visible
Reuters reported that Brent crude settled at more than $105 per barrel on September 28 as uncertainty surrounding the conflict continued to influence the oil market.
The precise price will move with every development in the war and negotiations, but the broader issue is more important than one day's number.
Markets hate uncertainty.
A tanker operator does not need to know that Hormuz will definitely close to demand a higher risk premium.
An oil trader does not need to know that supplies will definitely disappear before pricing in the possibility.
That is why diplomacy itself can influence markets.
A credible agreement could reduce the risk premium.
A collapse in negotiations could increase it.
Iran is negotiating from a strategic position
The most significant feature of Tehran's proposal is that it connects something the world wants — the restoration of normal maritime traffic — to things Iran wants from Washington.
That creates a bargaining mechanism.
Iran cannot simply force the international community to accept its broader demands.
But it can make the Strait of Hormuz part of the negotiation over the future of the conflict.
This does not mean that Iran controls the waterway without limits, nor does it mean that Washington must accept Tehran's conditions.
It means the strategic importance of Hormuz gives any discussion over its reopening consequences far beyond Iran's borders.
The United States, meanwhile, has its own leverage.
Washington controls major financial and economic sanctions affecting Iran and can influence access to international financial markets.
It also has significant military capabilities in the region.
That is why neither side enters the negotiations without bargaining power.
The nuclear issue remains the hardest problem
Even if the two sides agree to stop fighting, the underlying dispute does not disappear.
Iran's nuclear program remains at the center of Washington's concerns.
The United States has continued to insist that any durable settlement address nuclear issues.
Tehran, meanwhile, wants the economic consequences of the conflict reversed and has linked sanctions relief and access to frozen assets to its proposed settlement.
This creates a difficult sequence.
Does Iran make nuclear concessions first?
Does Washington provide sanctions relief first?
Does Hormuz reopen before or after those steps?
Who verifies compliance?
What happens if one side believes the other has violated the agreement?
These questions destroyed previous diplomatic arrangements.
According to Reuters, the two countries had already reached ceasefire agreements in April and June, but both eventually unraveled.
That history makes verification crucial.
A ceasefire is not necessarily peace
This may be the most important distinction in the current negotiations.
Stopping military operations is one thing.
Creating a settlement that survives political pressure is another.
The United States and Iran have fundamentally different strategic objectives.
Washington wants restrictions on Iran's nuclear capabilities and changes to the security environment.
Tehran wants an end to military attacks, sanctions relief, access to frozen assets and recognition of its interests.
The parties therefore need more than a document announcing that the shooting has stopped.
They need mechanisms that make breaking the agreement more costly than respecting it.
That could involve international monitoring, synchronized commitments, verification procedures and clearly defined consequences for violations.
Without those mechanisms, another ceasefire cou
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