MARCH 25, 2026
The Strait of Hormuz | The waterway is a vital shipping route for global oil trade.
Iran said it rejected a US ceasefire proposal and maintained attacks on Israel and Gulf Arab states, delivering a blow to Washington’s efforts to end a war that’s wreaked havoc across the Middle East and global markets.
A move by US President Donald Trump to start indirect talks is illogical and not viable at this stage of the conflict, Iran’s semi-official Fars news agency reported on Wednesday, citing sources it didn’t identify.
Tehran has its own conditions for a ceasefire, state-owned Press TV added, citing an unnamed senior security official. Iran wants guarantees that the US and Israel won’t resume their attacks, alongside reparations for war damages and recognition of its authority over the Strait of Hormuz, it said.
The US has compiled a 15-point peace proposal that Pakistan delivered to the Islamic Republic, according to people familiar with the matter, highlighting the urgency within Trump’s administration to resolve a conflict it started alongside Israel almost a month ago.
The plan stipulates that the Islamic Republic dismantle its main nuclear facilities and use a reduced missile arsenal in self-defense only, according to several people familiar with the matter. Iran would get certain concessions in return, including sanctions relief.
Brent crude prices traded around $100 a barrel after the flurry of news on a potential ceasefire, as traders weighed whether or not an imminent resolution to the conflict is likely. Iran has effectively shuttered the Strait of Hormuz, a conduit for about a fifth of the world’s oil and liquefied natural gas, triggering a global supply shock. That’s sparked fears of an inflation crisis and worldwide food shortages.
Iran maintained its missile and drone strikes on Wednesday, and shows little sign of backing down in the face of a relentless Israeli and US bombardment. Iranian media said the country fired more missiles at Israel, while Saudi Arabia intercepted a drone in the east of the country. A strike targeting Kuwait set ablaze a fuel tank at its main airport.
Trump has publicly signaled any peace agreement would have to include a prohibition on Iran ever obtaining a nuclear weapon or enriching radioactive material for civilian purposes. He’s repeatedly said this week that Iran wants to “make a deal.”
The US leader has said he hopes to reach an agreement by the end of the week. That may be difficult given the wide gaps that remain between the sides, even if talks get officially underway. It’s unclear who the US would negotiate with, given a lack of clarity about Iran’s power structure following the killing of Supreme Leader Ali Khamenei on the first day of the conflict. Several other leading government and military officials have also been killed.
On Monday, Axios identified Mohammad-Bagher Ghalibaf, Iran’s speaker of parliament, as the likely front man for talks, though he denied negotiations have taken place.
“We are closely monitoring all US movements in the region, especially troop deployments,” Ghalibaf posted on X on Wednesday. “Do not test our resolve to defend our land.”
There’s also little clarity over whether Iran will immediately allow commercial ships safe passage through the Strait of Hormuz, as well as how Israel would respond to any deal.
It is unclear if Israel, which triggered the war alongside the US with strikes on Iran on Feb. 28, has signed off on Trump’s overtures. Israeli officials have said they’ll continue striking Iran for now.
Israeli Prime Minister Benjamin Netanyahu has asked close confidant Ron Dermer to monitor the US-Iranian negotiations and make sure the Jewish state’s interests are upheld. The appointment signals how seriously Netanyahu views the talks and how his government is wary of the US opting for a deal that undermines Israel’s security.
Gulf states such as Saudi Arabia and the United Arab Emirates are considering joining the war against Tehran, according to several people with knowledge of the situation. They would only do so if the Islamic Republic attacks vital power and water infrastructure — a high threshold, the people said.
Turkey, meanwhile, is conducting intense diplomacy to try and prevent Gulf Arab countries from becoming involved, according to people familiar with the matter.
Steve Witkoff and Jared Kushner, two of Trump’s special envoys, as well as Secretary of State Marco Rubio and Vice President JD Vance have been involved in the negotiations with Iran, according to the president.
Despite the talks, Trump has ordered thousands of troops to the Middle East as he weighs options for ending Iran’s stranglehold on the Strait of Hormuz, a crucial shipping corridor for oil, natural gas, metals and other commodities.
The president boasted Tuesday that the US is in “a good bargaining position” after weeks of strikes that he says have taken out Iranian missiles, launchers and ships.
Fuel prices in San Francisco. – Photographer: David Paul Morris/Bloomberg.
Yet, in the US, Asia and around the world, the conflict has led to surging fuel and fertilizer prices, with commercial tankers avoiding crossing the strait and Iranian attacks damaging energy infrastructure.
Iran has more aggressively asserted its control over Hormuz, starting to charge transit fees for some commercial vessels. Payments of as much as $2 million per voyage are being sought on an ad hoc basis, effectively creating an informal toll on the waterway, according to people familiar with the matter.
More than 4,500 people have been killed in the conflict, according to governments and non-government agencies. Around three-quarters of the fatalities have been in Iran, while more than 1,000 people have died in Lebanon, where Israel is fighting a parallel war against Iran-backed Hezbollah militants. Dozens have been killed in Israel and Arab Gulf states.
Courtesy/Source: Bloomberg
