Iran-Oman talks to reopen Strait of Hormuz

0:00This BBC podcast is supported by ads outside the UK. It's been five months since the deadliest civilian strike of the U.S.-Israel war in Iran. 120 children killed at a school. Experts say the evidence indicates it was American forces that hit the school. But the U.S. government has not admitted responsibility. I'm Asma Khaled, and I host the Global Story podcast on the BBC. The BBC has now visited the site of the school and spoken to Iranians about what they saw. For more, listen to The Global Story on BBC.com or wherever you get your podcasts.

0:42Hello to you and welcome to NewsHour from the BBC World Service with me, Sean Lay, coming to you live from the BBC studios in central London. We begin this hour with growing signs that Iran and Amman, which have land on either side of the Strait of Hormuz, may have agreed arrangements for managing shipping in and out of this globally critical waterway. United States has been agitating for the Strait to be reopened, conscious that the disruption caused to world trade by its closure is adding significantly to cost pressures on American consumers, the people who will, in November, become voters in the midterm elections.

1:18Earlier on Tuesday, the US Treasury Secretary Scott Besant said Washington could reach a deal with the Iranians by Wednesday to reopen the Strait of Hormuz. Here he is talking about that on CNBC. We've seen President Trump last week threatened what would have been one of the largest military campaigns or the largest military campaigns since World War II against the Iranians. And now we are, because of that, we are in talks with the Iranians. And I think 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. There is some skepticism from experts in the Middle East about that suggestion that Iran and the United States are talking to each other.

2:06Iran had certainly been talking with Amman about the strait and Amman is likely to have kept Washington, its ally, fully informed. If so, President Trump would be able to endorse a deal done to reopen the strait and try to get some political capital from the outcome, even if his own administration wasn't actually responsible for achieving it. But what might a deal between Iran and Oman look like? It's a question I put to Dina Esfandiari, the Middle East lead at Bloomberg Economics. It looks like the contours of a very, very limited deal appear to be on the table. And it looks like that deal is going to be solely focused on the Strait of Hormuz and how ships would go in and out.

2:46Now, what's really being discussed right now appears to be one route in and one route out, one alongside the Iranian coast, one alongside the Omani coast. But that appears to be the broad contours of what's being discussed. So in effect, it would formalise what's emerged during the course of the conflict with Iran saying, we control or at least we control this route into the Strait of Hormuz in a situation where in the past, nobody controlled access or egress from the Strait of Hormuz. Is that what we think is now happening? Absolutely. We are no longer talking about if Iran would coordinate with ships or control parts of the straits, but rather how Iran would control parts of the straits and how ships would have to coordinate with it, which is a very different situation and a huge strategic gain for Iran.

3:42Is it going to cost the shipping companies for their craft to be allowed in and out of the straits, or almost? Is that clear? Well, that appears to be the million dollar question right now, quite literally. The Iranians certainly have been clear from the beginning. They want to impose a cost. They want something to show for this war. They need something to show for this war because of the economic situation back home. And this would help towards that. So they've been talking about a toll. When that became unpalatable, they started talking about fees, fees that have been imposed in other waterways by other people.

4:16So they're really trying to draw a parallel and downplay it. Now, what's critical is that this has been completely in opposition to the US position and even to some of the European positions when it comes to management of the strait. But it looks like at the end of the day, it might become a bit of a fait accompli. It's also striking that the US Secretary of State Marco Rubio just a few days ago was saying explicitly that what was at stake here is not simply the issue of what is – I'll quote him in fact – what is at stake here is not simply the question of what is happening in the Strait of Hormuz.

4:51It's a very fundamental principle about freedom of navigation. If this deal is as it has been described, then that would effectively be something that the United States is having to accept a compromise on. Absolutely. Freedom of navigation in the Strait of Hormuz is a thing of the past. Events on the ground have demonstrated that that is not the case today. The deal that is being reported is formalising the fact that freedom of navigation is no longer going to be a thing in this waterway. So I think those days are gone and we're not going to be able to return to the pre-war situation of freedom of navigation.

5:30And in terms of why it should matter to us in other parts of the world, how important is it to get the strait reopened and the free movement of shipping there? How much disruption has this caused over the last, what, six months or so? The disruption has been significant. We have a tendency to just talk about the disruption in energy, so oil and the provision of gas from Qatar. But actually, it covers many different sectors. It disrupts food supplies because a lot of the world's fertilizer goes through there. But it also disrupts food supplies for the Gulf Arab states that border these waters as well.

6:07So it's a very serious situation. and the longer it lasts, the worse it gets. But it's important to highlight that what we're talking about here is not really the perpetual closing of the strait, but rather who's going to be administering it. That's really what this deal focuses on. Iran stands to gain from opening the strait. So I think its opening is just a matter of time. It really is that freedom of navigation will no longer be the case in the strait, but it will be open. The US President Donald Trump was saying just a matter of hours ago that he thought the oil companies were, well, in effect, profiteering from what had happened, that they were overcharging for oil.

6:47How much impact could a deal on the Strait of Olmour have on the oil price and therefore on the prices that are hurting consumers in so many countries around the world? Well, I think we heard actually today, which was very interesting, that the Saudi Aramco, the national producer of oil, had actually made a significant profit as a result of the rise in oil prices, despite the fact that Saudi Arabia has been getting less barrels out. So evidently, some people are still profiting off this state of affairs, as it were. Now, we've seen that anytime there's good news when it comes to the Iran war, the price of oil decreases.

7:24We saw it today when Qatar announced that they thought something was happening and there was a deal to be had. We saw it on Monday when markets opened after President Trump had said on Monday afternoon, there will be talks. This is a cycle that we've been privy to over the last few months. So it's undeniable that if there really is a deal to be had, if the straight opens, then yes, the price of oil is likely to go down and that will have an impact on the consumer. That's Dina Esfandiari of Bloomberg Economics. Partly in response to US Treasury Secretary Scott Besson's comments, the price of Brent crude oil dropped by 4 % Tuesday.

7:59The five biggest Western energy companies, that's BP, Chevron, ExxonMobil, Shell and Total Energies, posted a combined net profit of almost$47 billion. President Trump weighed in by criticising them for making too much money as a result of the war. He demanded that they lower prices for consumers. The world's largest oil producer is, as Dina was mentioning there, Saudi Aramco. Its profits in the last quarter were up 44%. That's despite the limited access through the Strait of Hormuz, as well as Houthi attacks on Saudi ships journeying through the Red Sea. Emma Ashford is a senior fellow with the Stimson Center's Reimagined US Grand Strategy Program.

8:44I asked Emma if we should be surprised by the amount of money made by those five energy companies. You know, it's funny under other circumstances. One can see President Trump being very pleased by these profits for the energy companies. But what is happening here is what always happens during this kind of energy crisis. Consumers pay more as prices have gone up. That means energy companies end up actually reaping a windfall. And so we shouldn't be surprised by this, but we are going to see this political backlash. The president says they're making too much money. Is it possible to say to what extent the price of oil has gone up because there is a scarcity, because it's getting difficult to get it to market because of the war, or a combination of that and companies putting up their prices because they can?

9:33Companies are not artificially inflating their prices. In fact, oil is one of those markets where we actually see pronounced volatility in the price on markets and then as it filters down to consumers. What we can say is that even though oil prices are sticking about$90 or$100 a barrel at the moment, That's pretty low by historical standards, but it's 150 % of what it was just six months ago. So that is where that extra profit is coming from. And what are the companies doing with that profit? For the most part, at least if we're talking about Western energy companies, they appear to be using it to pay down debt, bolster their bottom lines, and put themselves in a position for a future where perhaps oil prices go down again.

10:18There is a difference, I would say, between Western oil companies like Exxon or Chevron, which are doing very well out of this crisis, and the more traditional state-owned oil companies in the Gulf, like Saudi Aramco, which are doing OK, but they're suffering a lot more because they're the ones who can't get their product to market as easily. Now, if there is a deal that allows the Strait of Hormuz to be open again and free navigation of ships in and out, what knock-on effect could that have on the oil price? So it's very likely that if we get a deal, the analysts estimate that, you know, within six to nine months, we could actually have a glut of oil on the market because more production has come online.

11:03Everybody's looking for new sources. So we would expect that price to go back down again pretty quickly. It would take a few months for production to dial back up. But, you know, within, again, six months to a year, we would probably be in a much better place. Nonetheless, the profits will have been accrued. Is there likely to be further political pressure, do you think, in countries for some kind of windfall tax on the basis that the level of profits has been extraordinarily high? and that maybe those countries will feel that their consumers, their voters, should share the benefits with the oil companies?

11:39This is a really common political discussion when we get this kind of price spike. The problem is, of course, that if you are an energy company, maybe you're experiencing windfall today, but next week, next year, maybe the price goes down substantially and you are in a more difficult situation. you don't necessarily get support from the government to back you in that case. So oil is a very volatile business. Prices go up and down a lot. And companies have to use the profits from the good times to tide them through the bad times. So I think we will see political pressure, but it's probably not long term a good thing for that to happen.

12:19What about in the United States? Because we've had this signal from the president of his displeasure. A lot of companies respond to President Trump's signals because they're worried about what he will do if they don't. Is there any sense that the Trump administration might look at, if not a windfall tax, some kind of price cap on energy in the United States? I mean, with this administration, you can never take anything off the table. But I think it's very notable that, you know, the president is suddenly worried about this. But, you know, as recently as a week or two back, he was talking about how great it was that America had record exports of energy that we were producing enough to supply the world.

13:00So I think what the administration is trying to do is dig itself out of a hole on Iran, a hole that is about the war with Iran, that's about the strategic problems, the Strait of Hormuz. It's not going to be solved by pressuring energy companies. And I really doubt the administration is going to be able to achieve what they want with sort of angry tweets on the subject. That is Emma Ashford from the Stimson Center in Washington, D.C. You're listening to the BBC World Service. This is NewsHour.

13:37Coming up, the musical which uses humour to raise awareness about the chronic women's health condition, endometriosis. It's funny and it has a message. Parts of it will leave you in tears, but you'll also be like rolling on the floor laughing. Our headlines this hour, oil prices have again fallen after the latest suggestion from US officials that a deal with Iran about reopening the Strait of Hormuz might be imminent. President Volodymyr Zelensky of Ukraine has accused Russia's military of taking pleasure in killing ordinary people after a video emerged of a drone hunting down and injuring a Ukrainian vegetable seller.

14:12And the goalkeeper of Cape Verde football team has become an unexpected star at the World Cup, has now signed for a club, the leading club in Chile, Colo Colo.

14:37This is Sean Lay at the BBC Studios in London with NewsHour, live from the BBC World Service. A mass funeral has taken place in Gaza City for 112 people who died in an Israeli airstrike three years ago, ever since the bodies had been trapped under collapsed buildings. Last week, President Trump announced that Hamas is ready to disarm and Israel to withdraw once it has done so from Gaza. It's close to a year now since the US brokered a ceasefire deal between the two sides, but there's still been no rebuilding. Most Gazans remain in tent camps or in the rubble of half-destroyed homes. In the most trying circumstances, though, some are attempting to connect to the outside world and make a living through their laptops.

15:23Israel imposes tight restrictions on foreign journalists entering Gaza, so our Middle East correspondent Yolan Nell has been taking advantage of that remote access to speak online to tech workers in Gaza. I lost all of my equipment, I lost my house, I lost my office, and I was thinking that is the end of the world here in Gaza. Mahrein Bayed, his wife and three young children, now live in a tent in Gaza City. Despite his ruined surroundings, he's one of thousands of well-educated Gazans trying to make a living online, coding and programming. I can work here in Gaza. Anything that is in the freelancing work, starting from mobile application for iPhone, Android, Flutter, to websites, even ads.

16:06So anything that can be worked remotely, we can do it here in Gaza. With Gaza's economy all but destroyed and 80 % of people with no income, NGOs see the potential of remote work to fill a desperate need. Yeah, it's really critical. I mean, we talk about it now as sort of a digital lifeline, right? This idea that if you have a laptop, if you have a working internet connection, you can work and earn income. Nicole Hark is country director for the American NGO Mercy Corps, which is trying to help Gazans, focusing on training, getting contacts for freelancers and supporting the new independent co-working spaces that are popping up in Gaza City and elsewhere.

16:47It's really critical to help people get back to work. They don't want to be dependent on aid. They're not looking to sit there and do nothing, right? But it's really finding a safe space and finding something that's affordable and that continues to have consistent electricity and internet is shockingly incredibly difficult. These hubs have generators and solar panels to provide power and a better internet connection, while most of the population is still living in tents. So let's start with AI engineering. I got these two questions from an engineer and actually I stuck. Wala Valides is a 24-year-old computer software engineer and her family's main breadwinner.

17:27Today, she's talking to one of her mentors based in California's Silicon Valley. I have like lots of international mentors who not just help me in the technical skills, also in the soft skills, also in the mental health. My mental health, it's not in zero, it's in minus. So, yeah, if you want to complete despite all of these struggles and circumstances or do you want to just wait for a miracle to happen or wait for something to happen and absolutely it will not happen if you don't do anything. Walat has recently got a full-time job with a Dubai-based company.

18:09With almost daily bombings, as Israel says it's continuing to target Hamas, safety is still a big concern. And there are plenty of other challenges for tech-savvy Gazans to overcome, as well as the unstable electricity and internet. Banking restrictions make it difficult to be paid.

18:34lachlan is finding it hard to get his laptop screen repaired at this makeshift workshop there are tight israeli restrictions on what comes into gaza including computer parts because israel sees them as having a possible military use this test is very hard for us but we are trying to survive. We are trying to say thanks God for what we can do and we start our life again. Gaza's wider recovery may be at a standstill and yet its tech workers give a glimpse of a brighter possible future. That was Yolande Nell reporting.

19:11The Via Alpina is one of the world's toughest endurance challenges. A trail across the Alps spanning 2 ,000 kilometres, covering eight different countries with 116 stages. Ultra runner Sophie Woods, who's 42, has become the fastest person to complete it, which she did at the weekend after just 29 days. The course has an elevation equivalent to climbing Mount Everest a dozen times, going through a series of countries, Slovenia, Austria, Germany, Liechtenstein, Switzerland and France, before ending on the Mediterranean coast in Monaco. and I bet that's a sight for sore eyes after such a long climb.

19:49Well, Sophie has been telling New South's Regine Vanden Nijten about the challenge. Every day was tough, just really tough. You know, I think when we first planned it, I actually expected to move faster than I did. The terrain was a lot more technical than I was expecting and we faced quite a few sort of crises along the way. I mean, you talk about some of the challenges there. of course Europe is going through a heat wave at the moment. What sort of extreme weather conditions did you personally encounter on your run? So we had two heat waves, which was awesome. I think it probably got up to about 37 degrees, which is a lot when you're at altitude running.

20:31And then we also had some storms to contend with. And then there were just all sorts of things like the van had, you know, a flat tyre at one point, we had to deal with huge swarms of bugs and And it was, yeah, it was a challenging time, not to mention the fact that there were wildfires happening at the same time that we had to actually divert away from because the route went right through them. And how do you prepare for something like this? I've been running ultramarathons for the last decade. I've run in some of the most incredible races around the world. And I think that that really prepares you.

21:08So it's spending long days out by yourself, learning how to be strong and capable in the mountains and have skills to effectively save yourself in these sorts of conditions. It's something that you build over years of experience. But leading into this, I was very aware that my body was going to take a pretty big hit. And so I was focusing a lot on my strength work, on making sure that I was eating really well and making sure that I started with as many stores as I could. You've spoken in the past, haven't you, Sophie, about some of the fertility challenges you faced as well and how some of that in some ways inspired you to take on this challenge.

21:51I wonder if you could share more about that as well. Yeah, I mean, going through trying to get pregnant and IVF whilst also being an ultra runner is a really contradictory sort of thing. You're so used to getting your body to do what you ask it to do. And then all of a sudden it just won't cooperate. And coming to terms with the fact that we weren't going to have a child has been really, really difficult for me. And so this kind of I guess I fell out of love with my body and out of love with my sport. And this has really reignited that passion again, because my body's amazing. She's just done the most incredible thing for me.

22:29And I've had the most amazing adventure, which is why I got into the sport in the first place, was to have adventures in incredible environments. And how do you mentally prepare for this? You've spoken about the physical preparation. The mental side of it is really important. And I think that I have really practiced this through my years of racing of just, I just keep moving. No matter what happens, I just keep moving. Like the urge to stop, there is always going to be that little voice in your head being like, just have a wee seat. Why not? There's one there. You know, nothing grows in the comfort zone.

23:05So you just got to keep moving forward. And I think if you practice that enough, it just becomes conditioning. and also the fact that I had so many people out there supporting me and cheering me on. That is invaluable to know that no matter what time of day I was out on the trail, if it was the middle of the night, there were people somewhere in the world checking on my little dot, making sure that I was still moving. And she certainly was Sophie Woods, who completed the Via Alpina in just 29 days.

23:38It's been five months since the deadliest civilian strike of the U.S.-Israel war in Iran. 120 children killed at a school. Experts say the evidence indicates it was American forces that hit the school. But the U.S. government has not admitted responsibility. I'm Asma Khalid, and I host the Global Story podcast on the BBC. The BBC has now visited the site of the school and spoken to Iranians about what they saw. For more, listen to the global story on BBC.com or wherever you get your podcasts.

24:11Welcome back to NewsHour. In London, we're coming out of a heat wave which has brought sweltering temperatures for more than a fortnight. It's been that way on and off in Europe for most of the summer. The continent has been trying to buy its way out of the heat. Air conditioner exports from China into the European Union hit nearly$3.8 billion in the first half of the year. That's up more than 40 % on a year ago. Many shops across the continent have sold out and prices have climbed. Business Daily's Sam Fenwick has been following the money chain behind Europe's aircon boom. This is a queue outside a discount supermarket in Paris one morning in July.

24:49The queue goes round the building. They're not there for freshly baked bread. They're there for a box with a fan in it. Within minutes, the shelves are empty. There are scoffles in the aisles and fights break out and this footage goes viral. Only about a fifth of European homes have air conditioning at all. In Northern Europe, it's more like one in ten. But France alone has had four heat waves since May. Nicolas Léger is a retail analyst at Nielsen IQ in France. He says 4.6 million fans and air conditioners were sold in France between January and June, double last year, three times the figure of four years ago.

25:34But then the stock ran out. This year, the average price spent by Barriers has increased by 10%. Sometimes you have no choice. Most of Europe's air conditioning is made in China. Midia is one of the biggest manufacturers. It's sold out of portable units in June. The problem isn't making them, it's getting them here. By sea from southern China takes two to three months with customs, so a unit ordered when the heatwave starts arrives after the summer's over. Tobias Strobel is Medea's Head of Innovation for Europe. We transported some thousand units by train. We will not make much margin, but at least we can provide some of the porters because of this big demand.