A woman and a child walk past Iranian-made Zolfaghar missiles displayed at Azadi Square in Tehran on July 24, 2026.
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Treasury Secretary Scott Bessent has told CNBC a deal to reopen the Strait of Hormuz is in sight, after President Donald Trump warned that the latest round of negotiations with Iran is the "last chance" to bring an end to the five-month conflict.
"We are in talks with the Iranians," Bessent told CNBC's "Squawk Box" on Tuesday. "There is a chance we may have a deal today or tomorrow to open the Strait and move towards a more normalized position in this conflict."
The Treasury Secretary said the deal would allow freedom of movement in the strait when asked whether Iran would be allowed to charge a toll.
Bessent's words helped reverse previous oil price increases. They had rebounded initially on Tuesday, jumping as much as 3%, as traders became less confident that a diplomatic solution to the conflict was in sight. But they reversed sharply after Qatar's confirmation of diplomatic efforts and Bessant's interview.
His words came after Trump told reporters in the Oval Office late on Monday that talks are "going on right now," at the request of Iran, Saudi Arabia, the United Arab Emirates, Qatar and others.
Tehran has continued to deny that any direct negotiations with the U.S. are taking place — or that there are plans to hold them in the future.
But Qatari foreign ministry spokesperson Majed Al Ansari said on Tuesday that its diplomats were working with other mediators, including Pakistan and Oman, to facilitate negotiations and exchange drafts between the U.S. and Iran.
Iran's President Masoud Pezeshkian said on Tuesday that Tehran would continue to defend its borders but insisted it does not seek an expansion of the conflict, according to state media reports.
"This is a last chance for them to sign a good document," Trump said.
In a Truth Social post earlier on Monday, Trump described Iran's leaders as "unbelievably duplicitous" and accused them of lying about peace talks that are underway, "whether Iran wants to admit it or not."
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Oil prices swung sharply after Bessant's claim that a Hormuz deal is in sight.
It came after the president decided to call off "massive attacks" on Iran to allow for talks he said were starting on Monday. The decision lifted market sentiment, with oil prices slumping in response.
West Texas Intermediate futures were down 4.44% at $76.77 per barrel as of 7:58 a.m. ET on Tuesday. Brent crude, the international benchmark, was up 3.5% at $80.84 a barrel.
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Analysts at Goldman Sachs said in a Tuesday note that traders are pricing "only a moderate risk premium despite still very high uncertainty about Mideast supply."
"We assume Brent stays in its $80-90 range until either a confirmation of a new U.S.-Iran deal or a significant escalation in attacks and targets," they said.
U.S. Central Command said on Monday it had redirected 44 commercial vessels as part of its ongoing blockade of the Strait of Hormuz, having disabled two and boarded two.
Meanwhile, Iraqi pro-militia outlet Naya late on Monday reported an explosion in Kuwait overnight that could be heard in Basrah Province.