Muscat Protocol: Iran-Oman Sign Strait of Hormuz Shipping Agreement; 'Green Channel' Opens for Commercial Traffic

A major diplomatic breakthrough in the Strait of Hormuz crisis emerged on April 5, 2026, as Iran and Oman signed the 'Muscat Protocol' — a joint maritime monitoring agreement establishing a 'Green Channel' for commercial shipping through the Strait. The agreement created a joint Iran-Oman maritime monitoring center to oversee commercial vessel transit and separate civilian commercial traffic from military-relevant shipping. The diplomatic breakthrough — brokered by Omani Foreign Minister Badr al-Busaidi, drawing on Oman's historic role as a back-channel intermediary between Iran and the West — was immediately welcomed by Asian shipping companies (Japan's Nippon Yusen, Korea's HMM, and Taiwan's Evergreen) that had been rerouting tankers around the Cape of Good Hope at significant cost. Oil prices began retreating in overnight Asian trading. US futures rallied modestly. The Muscat Protocol was described by analysts as a partial resolution: it did not formally end the Iran conflict, nor did it eliminate Iran's ability to threaten the Strait, but it created a structured de-escalation mechanism that reduced the probability of a sustained Hormuz closure. The ceasefire signals that had briefly sent markets higher on April 1 were now formalized in a maritime-specific format, though a comprehensive peace agreement remained elusive.