Iran proposes seven-day Hormuz reopening if US meets terms, oil dips

Iran has presented a rapid offer to resolve the conflict, promising to reopen the Strait of Hormuz within a week if the United States agrees to its conditions. Foreign Minister Abbas Araghchi will remain in New York through the weekend waiting for a US reply. Oil prices slipped slightly in Asian trading as the market assessed the proposal.

The conditions, outlined by Araghchi and President Masoud Pezeshkian in discussions with journalists and analysts, align with Tehran's recent negotiating stance. Washington would have to:

• adhere to the June memorandum signed in Islamabad
• remove its naval blockade
• unfreeze some Iranian assets
• restore the sanctions exemption for Iranian oil exports
• halt Israel's military campaign in southern Lebanon

Most of these steps would be required within the initial four to five days. In exchange, Iran would reopen the strait and commence discussions on its nuclear activities and the removal of US sanctions within a week of Washington's acceptance. The waterway would be reopened on a path largely inside Iranian waters that has already been coordinated with Oman, though Saudi Arabia is said to have reservations. The plan dramatically speeds up the timeline from the June memorandum, but it remains uncertain whether Washington will agree.

Energy markets also faced a new supply concern. Unconfirmed social media reports indicated Ukrainian drones struck Russia's Perm refinery on Friday morning, causing a fire. Perm is among Russia's biggest refineries and one of six that together account for roughly half of the country's diesel output. The reports have not been officially verified. If confirmed, the attack would add pressure to a diesel market where prices have reached record levels. Russia has already stopped diesel exports, and Washington has considered restrictions on US diesel exports, including a reported 90-day ban that Energy Secretary Chris Wright has denied.

Gold rose slightly toward $4,290 an ounce, recovering some ground after being pressured earlier this week by a stronger dollar, expectations of more Fed tightening, and surging government bond yields.

In bond markets, the global selloff continued to set the mood. The US 30-year Treasury yield climbed to near 5.5% overnight, its highest since 2004. The 10-year yield hit around 5.2% following stronger-than-expected US data and increased bets on further Fed rate increases. US mortgage rates have risen to about 7%. Japanese government bond yields followed Treasuries higher.

In currency markets, the yen found support from Tokyo. Finance Minister Satsuki Katayama said President Donald Trump raised concerns about the weak yen during his summit with Prime Minister Sanae Takaichi, who told him that an undervalued yen poses a problem. Katayama stated Japan would work closely with the US on currency matters, and USD/JPY fell to near 158.40. Separately, Goldman Sachs lowered its USD/JPY forecasts to 158, 155 and 150 over three, six and 12 months, down from 162, 163 and 165. It cited faster Bank of Japan tightening, possible repatriation of Japanese capital and the risk of intervention. Other major currencies moved quietly.

Japanese stocks climbed, with the Nikkei and Topix each gaining 1.2% by midday. Chip stocks led the advance, with Tokyo Electron and Advantest contributing the most, and investors bought ahead of Monday's deadline to qualify for interim dividends. SoftBank Group diverged from the trend after Oracle shares fell overnight on a report of power-related delays at a large New Mexico data centre. SoftBank is a co-investor with Oracle and OpenAI in the Stargate AI infrastructure project. Trading across the region was light, with mainland China, South Korea and Taiwan all closed for holidays.

In cryptocurrency, exchange Bitget confirmed that approximately $352 million was stolen from its hot and warm wallets on September 24, potentially the largest hack this year. The company said attackers breached a backend wallet system and forged transfers, rather than stealing private keys. Its chief executive said North Korea was highly likely responsible. Withdrawals have been suspended and cold wallets remain secure. The exchange says a user protection fund of roughly $465 million, backed by about $1 billion in capital, covers the losses. Bitget's BGB token traded around $1.96, only 3% to 5% below pre-hack levels, though the real test will come when withdrawals restart.

Looking ahead, President Trump, House Speaker Mike Johnson and technology chief executives are scheduled to meet on AI on Tuesday, September 29, as pressure grows on Washington to regulate the industry. The Reserve Bank of Australia also announces its decision on Tuesday. Nearly all economists surveyed expect a 25 basis point increase to 4.60%, a near 15-year high and the fourth hike this year, with most viewing it as the final move of the cycle.