US-Iran Peace Talks Stall as Conflict Nears Two-Month Mark

(Bloomberg) — Efforts to resume peace talks over the Iran war stalled after US President Donald Trump canceled a planned trip by his top envoys and the Islamic Republic said it won’t negotiate so long as it’s being threatened.

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Trump on Saturday told Jared Kushner and Steve Witkoff to skip the trip to Pakistan, which is mediating talks, and later told reporters that Iran “offered a lot, but not enough.” Iranian President Masoud Pezeshkian said his nation won’t enter “imposed negotiations under threats or blockade.”

While a ceasefire has mostly held since early April, both countries are maintaining a blockade on the Strait of Hormuz, making the key energy chokepoint virtually impassable. The disruption to about a fifth of the world’s oil flows has been dubbed the biggest supply shock in history by the International Energy Agency, and the conflict has prompted cuts to global economic growth forecasts.

“Too much time wasted on traveling,” Trump wrote in a social media post. “Nobody knows who is in charge, including them. Also, we have all the cards, they have none! If they want to talk, all they have to do is call!!!”

Iranian Foreign Minister Abbas Araghchi met mediators in Pakistan on Saturday and left Islamabad well ahead of the planned arrival of the US envoys. He said in a social media post that Iran has “yet to see if the U.S. is truly serious about diplomacy.”

Araghchi was in Oman on Sunday for talks with Sultan Haitham bin Tariq. He then returned to Islamabad, Iran’s state-run IRNA news agency said. Araghchi also spoke to the foreign ministers of Qatar and Saudi Arabia on Sunday. He intends to travel on to Russia after Pakistan, IRNA reported.

Araghchi will convey Iran’s conditions for ending the war, including a new legal framework for Hormuz, lifting the blockade, compensation for damage, and guarantees against further military action, the semi-official Tasnim news agency reported. He will not discuss any nuclear issues, Tasnim said.

US forces intercepted a sanctioned vessel in the Arabian Sea on Saturday as part of the blockade of Iran’s energy exports, according to US Central Command. The US deployed a Navy helicopter to intercept the vessel, which subsequently complied with US military directions to turn back to Iran under escort. A total of 37 vessels have been redirected since the start of the blockade, Centcom said.

Iran is in turn imposing its own blockade of Hormuz, using its “mosquito fleet” of gunboats. Daily transits are now close to zero, compared with about 135 before the conflict began Feb. 28. The oil market faces a guaranteed supply loss of around one billion barrels — in part because of the time it would take to revive flows once the strait reopens, Vitol Group Chief Executive Officer Russell Hardy said at the FT Commodities Global Summit.

Benchmark crude-oil prices closed at $105.33 a barrel on Friday, compared with $72.48 on the day before the conflict started. US gasoline prices averaged about $4 a gallon on Friday, compared with about $3 at the end of February. The conflict has also choked off about a fifth of global liquefied-natural-gas supplies, with benchmark prices in Europe now about a third higher than prewar levels.

Elsewhere in the region, Israeli Prime Minister Benjamin Netanyahu on Saturday ordered his country’s military to strike Hezbollah targets in Lebanon. The Israel Defense Forces on Sunday told residents of seven villages in southern Lebanon to leave. Israel later struck several areas, Lebanon’s state-run National News Agency reported. Hezbollah, in a Telegram post, said it will keep responding to the strikes.

Trump had announced on April 23 that Israel and Lebanon would extend their ceasefire by three weeks, paving the way for negotiations on a permanent peace accord between the two countries.

The ceasefire, which originally went into effect on April 17, came after almost two months of fighting, triggered by Hezbollah’s decision to join Tehran’s retaliation against the joint US-Israeli attacks on Iran by targeting Israel’s northern communities. Fighting escalated as Israel invaded southern Lebanon to create what it has described as a “security zone.”

“We are acting vigorously according to the rules we agreed upon with the United States, and incidentally, with Lebanon as well,” Netanyahu said on Sunday. “This means freedom of action, not only to respond to attacks, which is obvious, but to thwart immediate threats and also to neutralize emerging threats.”

–With assistance from Eltaf Najafizada, Patrick Sykes, Sam Kim, Tony Czuczka, Weilun Soon, Sara Gharaibeh, Galit Altstein, Elena Mazneva and Sherif Tarek.

(Adds Iran’s conditions for ending the war in 7th paragraph)