The Donald Trump administration has said the United States of America and Iran are in talks and both countries may reach a deal to reopen the Strait of Hormuz on Tuesday or Wednesday.

“We are in talks with the Iranians,” Treasury Secretary Scott Bessent told CNBC’s “Squawk Box” on Tuesday. “There is a chance we may have a deal today or tomorrow to open the strait and move towards a more normalised position in this conflict.”

Asked if Iran would be allowed to charge commercial vessels to use the critical oil shipment route, Mr Bessent said, “It would be freedom of movement.”

With U.S. crude oil prices falling nearly three per cent to $78 per barrel after his remarks, Mr Bessent said prices could decline further when the strait reopens to commercial shipping. Hundreds of ships have been stranded in the Persian Gulf amid the Middle East crisis.

“It’s not just energy. It’s fertiliser, it’s refined products; it is the various industrial gases,” he said. “We could see a big relief trade as those prices go down.”

Last Saturday, Mr Trump announced he halted a major attack on Iran to allow for negotiations on reopening the waterway.

Delegations from Tehran and Washington signed a memorandum of understanding on June 17 to end the war, but it fell through over disagreements on shipping routes.

Iran closed the strait of Hormuz, citing the U.S.’s continued blockade of its ports. Both countries have continued to exchange strikes.