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The new route follows a memorandum of understanding and two implementing agreements signed by Kenya and Rwanda in June. The agreements provide the framework for importing, transporting and storing refined petroleum products through Kenya.
"I'm rejecting their deal," the president told reporters at the White House on Saturday.
The attack drew attention back to the strait after threats to shipping in the Red Sea intensified last week.
The US and Oman have been negotiating separately with Tehran to reopen the Strait of Hormuz, a waterway that is vital to the global economy. It has been largely closed for nearly six months during the US-Iran war.
The government has not yet provided further details regarding the inaugural flight at the same time, criticism remains strong due to several previously failed claims by the government.
Both sides suggested on Saturday that discussions were progressing, but a timeline on any deal being finalised remained unclear. Oman's foreign ministry warned against attacks on shipping that could hamper that.
According to reports, the proposed agreement under discussion would establish a 60-day arrangement guaranteeing safe passage through the Strait of Hormuz between Iran and Oman. The temporary framework would not require shipping companies to pay transit tolls and could be extended if both sides agree
Iranian authorities confirmed they had again shut the Strait, reversing an earlier reopening, in response to an ongoing naval blockade imposed by the United States on Iranian ports.
More than 200 people have been killed since the attacks began, according to Iranian leaders, and at least 31 people were killed and 149 wounded in retaliatory strikes in Lebanon.
The discussions, brokered by Oman, have not produced a final deal, yet both sides agreed to continue talks in their capitals before technical meetings resume next week in Vienna.
According to the U.S. Treasury, many of those designated were previously targeted by the United States in May 2024.