On November 11, Iran’s chief nuclear and regional affairs negotiator Mohammad Bagher Ghalibaf publicly stated that the strategic Strait of Hormuz would never revert to its pre-conflict operational status, confirming Tehran has already reached a mutual operational understanding with Oman over lane management in the chokepoint, and that the United States has yet to issue a formal response to a seven-point set of Iranian demands for de-escalation. Just 48 hours prior to Ghalibaf’s remarks, U.S. President Donald Trump characterized the broader regional military conflict as “militarily effectively over” while confirming the U.S. naval blockade enforced around the Hormuz Strait would remain in full effect. The current deadlock stems from a mutual lack of trust: neither Tehran nor Washington is willing to make the first concession, as both sides assume the other will renege on any verbal or written commitments. This impasse presents a unique opening for the group of major Asian energy importers whose heads of state will gather in Shenzhen, China for the upcoming APEC Summit scheduled for November 18 and 19, to reshape the cost-benefit calculations for both parties. Asian economies have borne the overwhelming brunt of the Hormuz Strait disruptions: 2025 data from the International Energy Agency shows nearly 15 million barrels of crude oil transited the strait daily, with China and India alone accounting for 44% of that total flow. Japan’s trade ministry data adds that 94% of Japan’s total crude imports last year originated from Middle Eastern suppliers, and 93% of that volume traveled through the Hormuz chokepoint, while Bangladesh, India and Pakistan sourced nearly two-thirds of their total liquefied natural gas imports via the waterway. The market impact of the standoff has already been tangible: on November 5, global Brent crude prices jumped $3.67 to close at $98.29 per barrel immediately following a fresh wave of targeted attacks on commercial tanker traffic in the strait. Previous diplomatic efforts to resolve the standoff have failed not for lack of proposed frameworks, but due to a complete absence of enforceable compliance mechanisms. The Islamabad Memorandum of Understanding, brokered jointly by Pakistan and Qatar back in June, collapsed in less than 30 days after new rounds of cross-strait strikes broke out. Tehran’s core priority in any negotiated deal is to guarantee that any of its frozen financial assets released under an agreement cannot be re-impounded by Western authorities, while U.S. negotiators have insisted any final settlement must be strictly performance-based, with no funds transferred to Iran until it has fully verified all its stated commitments. A durable long-term arrangement would require a structured, phased mechanism that disburses value to Iran incrementally in exchange for sustained unimpeded strait access, paired with independent U.S. verification of compliance prior to any funds changing hands. Proposed transit toll frameworks have already been ruled out as a viable path: Reuters reports Iran initially demanded 5% to 7% of total cargo value as a passage fee, Oman floated a 3% rate as a compromise, and the U.S. has rejected any toll system entirely. Global maritime insurers have already inserted war-risk clauses that invalidate coverage for any ship that pays such compulsory charges, and leading international shipping associations have condemned mandatory passage levies as a de facto toll that would leave the strait in a permanent state of legal contestation, giving Washington perpetual justification to reject any formal agreement. A far more viable alternative framework calls for major Asian energy importers to resume limited purchases of Iranian crude, rather than paying for passage access. Japan, South Korea and India, all of which halted Iranian crude imports in 2018 following the re-imposition of U.S. sanctions, would restart limited volumes under a targeted U.S. sanctions waiver, with all payments deposited into local currency accounts held within the importing nations’ domestic banking systems, restricted exclusively to funding Iranian imports of goods and services from those same buyer countries. This model draws on the successful structure of U.S. waivers in place between 2013 and 2015, and briefly in 2018, which permitted Iranian crude imports as long as all corresponding revenue was held in restricted local currency accounts. The proposed new waiver would add one non-negotiable condition: guaranteed toll-free, non-discriminatory passage for all commercial vessels transiting the Hormuz Strait, verified independently via public, real-time global tanker tracking datasets. This structure delivers far stronger incentives for Iran than a passage toll system: Iran exported 1.69 million barrels of crude daily through the strait in 2025, and U.S. Central Command data confirms the ongoing naval blockade has kept more than $25 billion worth of Iranian crude off global markets. A fully open strait would immediately restore Iran’s oil export capacity and deliver a steady, predictable revenue stream from three major East Asian buyers, while any renewed closure would eliminate that income entirely. Tehran has already signaled preliminary interest in this path: the Iranian national oil company reached out to Japan and other former long-term crude customers as early as July to discuss resuming formal sales ties. While Ghalibaf has publicly stated the U.S. has no legitimate right to exercise control over the Hormuz Strait and must withdraw its military presence from the region, with a phased reduction of U.S. military deployments listed as one of Iran’s seven formal conditions, the proposed framework can partially accommodate Iranian priorities by formalizing the Iran-Oman joint operational management of shipping lanes, aligned with Oman’s longstanding regional management proposal that relies exclusively on voluntary contributions rather than mandatory fees. The arrangement cannot, however, fulfill Tehran’s demand for a full U.S. military withdrawal, and hardline factions within Iran may reject any deal that leaves the core infrastructure of the U.S. naval blockade intact. Significant risks remain for both parties: roughly $6 billion worth of Iranian oil revenue held in South Korean accounts was transferred to Qatar in 2023, only to be re-frozen following the October 7 attacks under a quiet informal understanding between Washington and Doha. Restricting all oil revenue exclusively to payments for tangible Iranian imports from the buyer nations would minimize the total volume of exposed, at-risk funds, while Washington’s cost of reneging on the agreement would rise substantially, as revoking the waiver would immediately cut critical crude supplies to three longstanding U.S. strategic partners. Critics in Washington, allied with political factions in Israel and Gulf Arab states who support maintaining maximum economic pressure on Tehran, have argued any new flow of oil revenue would allow Iran to rebuild its military capabilities. Built-in guardrails including strict limits on the volume of permitted Iranian crude imports, caps on total annual revenue flows, and independent regular audits of the restricted local currency accounts would reduce, though not fully eliminate, that risk, presenting policymakers with a clear choice between a tightly monitored, limited revenue flow and an open-ended, costly permanent blockade. Securing U.S. buy-in for the framework will be a major diplomatic hurdle: Trump has maintained the naval blockade as a core bargaining chip, and established a dedicated new U.S. Central Command task force on November 7 to tighten enforcement of the restrictions. The ongoing standoff is already creating significant domestic economic pressure for the Trump administration: AAA data recorded U.S. average retail gasoline prices at $3.98 per gallon and diesel at $6.16 per gallon on November 10, representing year-over-year increases of roughly 30% and 65% respectively, and Trump has publicly acknowledged the economic fallout from the regional conflict played a direct role in his party’s sweeping losses in the recent midterm elections. The proposed framework would allow Trump to formally lift the naval blockade on terms that align with his previously stated public requirements: no unrestricted cash would ever reach the Iranian government, all payments would be suspended immediately if the strait is closed, and the entire sanctions waiver program would have a built-in expiration date requiring explicit presidential renewal. The proposal also aligns closely with Tokyo’s stated public position: Japanese Foreign Minister Toshimitsu Motegi has confirmed Japan will not pursue unilateral bilateral negotiations with Iran, and only supports frameworks that guarantee unimpeded passage for all commercial vessels. Due to the current historically low point in Japan-China diplomatic relations, the lowest seen since the two nations normalized ties in 1972, the entire arrangement would need to be formally negotiated with U.S. coordination. Beijing’s formal role in the process would remain limited to not obstructing the framework: Iran supplied roughly 13.5% of China’s total seaborne crude imports in 2025, and Beijing is highly unlikely to route its own existing Iranian crude purchases through the U.S. waiver system. However, Chinese President Xi Jinping publicly offered in May to support diplomatic efforts to reopen the Hormuz Strait, and he and Trump reached a bilateral agreement at that time that the waterway must remain open to global traffic. Their scheduled bilateral meeting on the sidelines of the Shenzhen APEC Summit gives Beijing a clear opportunity to signal its support for the proposed framework and urge Tehran to engage in formal negotiations. The arrangement has clear, acknowledged limitations: it will not resolve the long-running Iranian nuclear dispute, end active hostilities in Lebanon, or deliver the full scope of broad sanctions relief Tehran has long demanded. It also relies on strict due diligence from participating commercial banks, after Iranian escrow accounts held in South Korea were previously exploited as part of a large-scale sanctions evasion scheme in 2011. The framework is not intended to replace a comprehensive final peace agreement, but rather to keep the critical energy chokepoint operational while broader, more complex geopolitical disputes are negotiated over a longer timeline. Pakistan’s earlier mediation effort in June demonstrated that Washington and Tehran are capable of agreeing on shared formal text, while its rapid collapse proved that signed documents alone cannot sustain compliance. As a longstanding neutral diplomatic mediator and a major energy importer heavily dependent on Gulf supplies, Islamabad is well positioned to encourage both parties to seriously consider the new framework. The model of paying Iran for its crude exports rather than for transit access gives Tehran a direct, sustained commercial incentive to keep the strait fully open, delivers Washington a clear, verifiable mechanism to confirm compliance, and provides major Asian energy importers with far greater long-term supply stability. As such, Asian leaders attending the upcoming APEC Summit in Shenzhen should prioritize placing this structured proposal on the official negotiating table. The analysis is authored by Bilal Habib Qazi, PhD, a research analyst at the Institute of Regional Studies, Islamabad, with views expressed solely his own and not necessarily representative of the institute’s official position.