Long-end bond yields need another dramatic escalation in the Mideast about like they need more tariffs, so it was with more than a little relief that Treasurys greeted reports of another interim arrangement to open the Strait of Hormuz.

Skirmishes between the US and Iran were frequent last month, and the situation escalated meaningfully when the Houthis declared a partial blockade of the Red Sea targeting Saudi oil tankers. Then Riyadh joined the US in striking Iran-linked militia in Iraq, raising the specter of another all-out melee.

Donald Trump was “locked and loaded and ready to go” with what he described on social media as a campaign of “Military Terror, Strength, and Power not seen since World War II,” but ultimately changed his mind over the weekend after the Saudis said Iran and Oman are close to establishing a mutually agreeable route for commercial vessels to transit the world’s most important maritime energy chokepoint.

“The reason they asked is they think there’s a deal on Hormuz,” Trump said, referring to a Saudi request that he postpone a return to major combat operations against Iran. In a statement, the Kingdom described the call between Trump and Mohamed bin Salman as an effort to “prevent a slide into a broader conflict with repercussions for regional and international security and stability.”

Gulf countries, The Wall Street Journal noted, “are frustrated with what they see as a lack of a clear strategy” from Trump. The Emirates are an exception. Abu Dhabi’s keen on the pipe dream that imagines a region entirely free from conflict and entirely open to business. The UAE’s all in on the idea that the region should be a giant magnet for global capital. And that the only way to achieve that is to eliminate the IRGC.

On Monday, a spokesman for Abbas Araghchi told reporters that although Iran’s not in direct talks with the US at the moment, they are in fact working with Oman to establish “an intermediate route” through the Strait that respects both countries’ “considerations and interests.”

The interim arrangement represents the most serious effort yet to resolve what’s become an untenable situation: Ships determined to make it through the Strait do so clandestinely using a route that hugs the Omani coast to the chagrin of the Guards, who view such traffic as a violation of Iran’s supposed “right” to play traffic cop in the waterway.

Progress towards a partial reopening and Trump’s decision to postpone “Military Terror” were enough to pressure Brent back below $85 to start the week, which in turn helped Treasury yields ease from last week’s highs.

Trump claimed a new round of direct talks between the US and Iran are scheduled for today. “Now what we’re doing is we’re talking to them in the form of a negotiation,” he said Sunday. “It begins tomorrow afternoon.” He provided no details.

On Monday, Iran suggested no such talks are planned. Negotiations with Oman are centered specifically on finding an interim arrangement on a jointly-managed route through the Strait for approved vessels, the foreign ministry said. “Matters relating to the United States will have to be examined in later stages.”