By Tucker Reals / May 7, 2026 / CBS News
What to know about the Iran war today:
– Iran says it is reviewing a new U.S. proposal to end the war while moving to formalize control of the Strait of Hormuz, which had been free and open before recent U.S.-Israeli attacks on Iran.
– President Trump expressed optimism a deal is near, saying the war will “be over quickly” and insisting it is going “unbelievably well,” but warned he could order “higher level” strikes if Iran rejects the offer.
– Optimism on talks eased oil prices and lifted markets; Brent crude and U.S. West Texas Intermediate traded below $100 a barrel early Thursday.
Oil and markets
Oil fell again Thursday and Asian equities rallied as investors grew hopeful the conflict could be resolved and the Strait of Hormuz reopened. Risk appetite improved after Mr. Trump said an agreement was possible, boosting demand expectations and supporting a rally in stocks and AI-related sectors. Brent and WTI slid more than 2% on the day and were under $100 following roughly a 10% decline over the prior two sessions.
Shipping authority and closure
Shipping intelligence firm Lloyd’s List reported Wednesday that Iran “has created a new Persian Gulf Strait Authority” (PGSA) to approve transits and collect tolls in the Strait of Hormuz. The firm said Iranian authorities circulated an application form requiring detailed vessel ownership, insurance, crew and route information and warned that, “as of right now the strait is closed,” with no recorded transits since May 4. The move signals Tehran positioning itself as the principal authority for vessels transiting the vital waterway that handles about a fifth of the world’s crude.
Diplomacy and international reactions
France’s President Emmanuel Macron told Iranian President Masoud Pezeshkian that strikes on UAE civilian infrastructure and ships near Hormuz were “unjustified” and urged both Washington and Tehran to lift their maritime restrictions immediately. Macron said he would raise a France- and U.K.-led proposal to secure safe commercial passage with President Trump. Iran’s presidency said Pezeshkian stressed any negotiations on reopening the strait require lifting the U.S. naval blockade.
U.S. stance and negotiations
Mr. Trump told reporters the U.S. has had “very good talks over the past 24 hours” and that “they want to make a deal.” He reiterated there is “never a deadline” for negotiations, dismissing the notion of a fixed cutoff and saying talks could continue. At the same time, he warned that if Iran does not agree to the U.S. terms, bombing could resume “at a much higher level and intensity.”
Domestic energy impact
Gasoline prices in the U.S. averaged $4.54 a gallon on Wednesday, according to AAA, the highest since July 2022 and roughly 52% higher than before the war began in late February. The rise reflects supply disruptions tied to the conflict even as crude briefly eased on hopes for a diplomatic solution.
Iran’s response
Iran has not publicly accepted the U.S. proposal. Foreign ministry spokesman Esmaeil Baqaei told local media the package is “still under review.” Tehran has simultaneously advanced measures to regulate and control maritime traffic through the entrance to the Persian Gulf, escalating tensions over who will govern passage in the strategic strait.
Outlook
Optimism about a deal has lowered commodity prices and buoyed markets, but major uncertainties remain: Iran’s formalization of authority over Hormuz, its response to the U.S. offer, and the risk of resumed, intensified strikes if talks collapse.