Iran has begun cutting oil production as a U.S. naval blockade in the Strait of Hormuz squeezes the country’s exports and leaves storage facilities increasingly full, Bloomberg reported Saturday, citing a senior Iranian official.
The cutbacks come as the standoff between Washington and Tehran deepens, with President Donald Trump rejecting Iran’s latest proposal to end the war and warning that the United States still has military options.
Trump 'not satisfied' with Iran’s latest proposal to end the war
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Iranian engineers have been working to manage oil infrastructure that has been forced in recent days to repeatedly halt and restart operations, according to Bloomberg. Hamid Hosseini, a spokesperson for Iran’s oil, gas and petrochemical products exporters’ union, said Iran has experience handling such disruptions.
The pressure on Iran’s oil industry has grown as the U.S. blockade prevents Iranian tankers from reaching open waters. Exports have plunged in recent weeks, and Iran’s domestic storage sites are filling up, raising the risk that Tehran will have to further reduce output from aging wells that may be difficult to restart.
The Associated Press reported Friday that the blockade is threatening Iran’s oil sector even as Tehran continues to restrict passage through the Strait of Hormuz, a critical waterway through which about a fifth of the world’s traded oil and gas normally passes.
Trump said Friday he was “not satisfied” with Iran’s latest proposal to end the war, which was delivered to mediators in Pakistan.
“They want to make a deal, I’m not satisfied with it, so we’ll see what happens,” Trump told reporters at the White House.
The ceasefire between the United States and Iran, originally expected to last two weeks, has been extended repeatedly and appears to still be holding. But negotiations have stalled, and talks mediated by Pakistan have so far failed to close the gaps between the sides.
Trump said he had been briefed Thursday by Adm. Brad Cooper, the head of U.S. Central Command, on possible military options if diplomacy fails.
“I mean, do we want to go and just blast the hell out of them and finish them forever? Or do we want to try and make a deal? I mean, those are the options,” Trump said.
Trump also criticized Iran’s leadership, describing it as fractured and difficult to negotiate with.
“It’s a very disjointed leadership,” he said. “They all want to make a deal, but they’re all messed up.”
Iran, meanwhile, has said its armed forces are prepared for any renewed U.S. action, according to Iranian state-linked media. A military source told AFP that a return to fighting was a likely scenario after Trump dismissed the latest Iranian proposal.
The economic toll inside Iran is mounting. The blockade has reduced hard-currency inflows from oil sales, adding pressure to an economy already battered by war, sanctions and unrest. Iran’s supreme leader, Mojtaba Khamenei, has urged companies to avoid layoffs as much as possible as the country faces what he described as an economic war.
Trump has said the blockade will remain in place until Iran agrees to a deal addressing U.S. concerns over its nuclear program. Axios reported this week that Trump considers the blockade more effective than bombing and has rejected an Iranian proposal that would reopen the Strait of Hormuz while postponing nuclear talks.
The president has repeatedly said Iran must not obtain a nuclear weapon.