Internal Iranian Rift Over Strait of Hormuz Threatens US-Iran Nuclear Deal Talks

Tensions between moderates and hardliners in Iran are jeopardizing ongoing peace negotiations with the United States amid disputes over control of the Strait of Hormuz. Moderates, led by President Masoud Pezhkian, seek to unlock billions of dollars in frozen assets to alleviate the economic hardships faced by millions of Iranians due to war impacts and damage to their oil industry. However, hardline commanders from the Islamic Revolutionary Guard Corps (IRGC) prioritize maintaining exclusive control over the strategic strait, even at the cost of losing access to these funds, according to sources familiar with the negotiations cited by The Wall Street Journal.

The IRGC aims to impose tolls on ships passing through the Strait of Hormuz to enrich Iran's armed forces and dominate regional security. They have demonstrated willingness to risk the release of billions of dollars frozen in Qatar by attacking vessels navigating the US-supported route through Omani waters instead of Iranian waters. The IRGC has reportedly warned mediators that they will close the strait again unless assured of exclusive Iranian control during talks in Doha. They also demand that the US and other countries abandon plans to move ships through the southern parts of the strait near Oman.

Controlling the strait is a top priority for the IRGC, surpassing the release of frozen funds earmarked by the US for humanitarian purposes. The IRGC controls the naval forces patrolling Iranian waters and views the strait as a valuable asset. They propose establishing a mechanism to charge fees for free passage, which Iranian officials estimate could generate up to $40 billion annually. Advisors and intermediaries for the IRGC emphasize that securing control over the Strait of Hormuz is more important than unlocking the frozen assets, complicating the prospects for a peaceful resolution between Iran and the US.