US President Donald Trump stated on Tuesday that there were no ongoing discussions with Iran and emphasized that the Strait of Hormuz was operational, contradicting Iran’s claim that the vital water passage remained closed to shipping. The fading hopes of reaching a resolution to the nearly six-month conflict led to a rise in oil prices, a decline in stock markets, and increased borrowing costs for major economies, including the US.
Following the expiration of a temporary ceasefire agreement on Monday, a senior Iranian official informed Reuters that Iran was transitioning to a “fully offensive” military stance due to the diplomatic deadlock. Despite this, there were no new reports of attacks from either side on Tuesday.
Trump confirmed in a post on Truth Social that there were no ongoing or scheduled talks with Iran and highlighted that the Naval Blockade was still in effect while affirming the openness and functionality of the Hormuz Strait. Meanwhile, Trump’s son-in-law and special envoy, Jared Kushner, expressed optimism on Monday, suggesting that discussions with Iran were more substantial than ever.
The conflict, which commenced with joint strikes by the US and Israel on Iran, has now evolved into a stalemate, with Iran threatening shipping in the strait and the US warning of potential renewed attacks if negotiations fail to produce a lasting resolution. One of the primary US objectives is to prevent Iran from obtaining a nuclear weapon, a task that experts believe will be challenging without addressing the enriched uranium believed to be buried at previously targeted sites.
Despite Trump’s positive remarks about the situation in the Gulf improving, reports continued to surface about attempts to disrupt shipping. The UAE’s Defence Ministry reported the detection of two ballistic missiles launched from Iran, the first incident of its kind since an earlier strike in May. The missiles were said to be targeting maritime traffic, according to UAE assessments, with both projectiles landing in the sea. Iran’s foreign ministry spokesperson refuted the UAE’s accusations, leading to a suspension of trade activities, exchanges, and financial transactions between the two countries.
Furthermore, there was a report from the United Kingdom Maritime Trade Operations on Tuesday indicating that a vessel had been hit by an unknown projectile while transiting the Strait of Hormuz, resulting in engine room damage and casualties among the crew. The Omani Coast Guard was providing assistance to the affected crew members, with no immediate response from Tehran.
Iran’s top negotiator, Mohammad Baqer Qalibaf, asserted that the strait would remain closed until the US fulfilled the conditions outlined in an interim deal signed in June. These conditions include lifting the blockade on Iranian ports, removing oil sanctions, releasing frozen assets, and ceasing threats and military actions. The failure to reach a broader agreement within the stipulated 60-day timeframe set in the June agreement led to its termination, primarily due to disagreements over control of the vital Strait of Hormuz.
Iran reiterated its willingness to engage in dialogue with the US but emphasized that negotiations should not be mistaken for capitulation. Iranian officials expressed concerns about the potential for increased economic hardships and unrest if further punitive measures were imposed on the country. The conflict has resulted in significant casualties, with thousands of deaths reported in Iran and Lebanon, along with airstrikes on US military installations and infrastructure across various countries in the region.
Throughout the conflict, Brent crude oil prices have surged, reaching $126 a barrel at one point, a substantial increase from prewar levels. Brent crude futures saw a modest rise on Tuesday, settling just above $91 a barrel. US officials reiterated the possibility of intensifying economic sanctions on Iran, warning of potential actions in the coming weeks and months.
