UAE, Iran Leaders Meet as Push to Resolve Hormuz Standoff Grows

(Bloomberg) -- Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed Al Nahyan met Iranian President Masoud Pezeshkian, as the Islamic Republic touts a potential deal to allow more ships through the Strait of Hormuz.

The rare public discussions between the two powers occurred on the sidelines of the BRICS summit in India and came as Oman seeks to bring the Gulf Cooperation Council and Iran together to discuss the waterway, a global chokepoint for energy exports.

Iran has said it will brief Gulf states on Monday on a new agreement, though says any deal won't amount to a full reopening of the strait and that it will have a say on which ships can traverse it.

Such a gathering has yet to be confirmed, while Bahrain has ruled out attending, citing recent Iranian-backed attacks on Gulf sites. Escalating fighting between Saudi Arabia-backed forces and the Houthis, a group based in neighboring Yemen and supported by Iran, may also complicate the plans.

Sheikh Khaled and Pezeshkian stressed the need to ease tensions, promote deescalation and strengthen regional stability, according to the United Arab Emirates's state-run WAM news agency.

Pezeshkian has expressed "balanced and rational" stances throughout the protracted crisis, Anwar Gargash, an adviser to the UAE president, said on X.

The conflict that began late February with US and Israeli strikes on the Islamic Republic has upended regional economies, with Tehran moving to shutter the Strait of Hormuz.

The US and Iran exchanged strikes on oil tankers in the Persian Gulf earlier this month. Tensions flared again in the strait over this weekend, with the UK Maritime Trade Operations saying a fire broke out on a ship hit by a projectile the day before. Iran's state-run IRIB on Sunday reported an "enemy strike" on a commercial vessel off Iran's Qeshm and Hengam islands that killed one person.

The UAE has been a prominent target during the conflict, and successfully fended off thousands of projectiles fired by Iran.

The Gulf state has taken a hard line toward Tehran during the war, with Abu Dhabi formally severing economic ties in August. At the same time, the UAE has called for a political solution.

Gargash last month said the "state of neither war nor peace" was unsustainable, and urged a solution that restored normal navigation through the strait.