Tehran has sent its latest proposal for negotiations with the United States to Pakistani mediators, Iranian state news agency IRNA said on Friday, a move that could improve prospects for breaking an impasse in efforts to end the Iran war.

IRNA gave no details but global oil prices, which have risen sharply since Iran started a blockade of the Strait of Hormuz, dropped after its report.

The blockade of the vital sea channel has choked off 20 per cent of the world's oil and gas supplies, and the U.S. Navy is blocking exports of Iranian crude oil. This has pushed up energy prices and increased concerns that there will be an economic downturn.

It was not immediately clear whether the Iranian proposal had been passed on to Washington yet.