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US-Iran Tensions Rise as Peace Talks Stall and Ceasefire Nears End
Washington and Tehran have signalled they are prepared to resume hostilities as uncertainty surrounds a second round of peace talks in Islamabad, raising concerns about a renewed escalation in the Middle East conflict.
The planned negotiations, aimed at ending weeks of fighting that have disrupted global markets, were thrown into doubt after Iran withdrew from the talks. The discussions were expected to involve senior US officials, including Vice President JD Vance, special envoy Steve Witkoff and adviser Jared Kushner.
The White House had indicated its delegation was ready to travel, but Tehran’s decision to pull out has left the diplomatic process in limbo. Iranian officials linked their withdrawal to the recent seizure of an Iranian-flagged cargo vessel by the US Navy, which they described as a violation of the current ceasefire.
The US has defended its actions, stating the vessel ignored warnings and attempted to bypass a naval blockade imposed on Iranian ports. The blockade was introduced after Iran shut down the Strait of Hormuz earlier in the conflict, a move that disrupted a key global oil route.
President Donald Trump has insisted the blockade will remain in place until Iran reopens the waterway to international shipping. In a statement on social media, he said the restrictions were placing severe economic pressure on Tehran and would not be lifted without a deal.
Iranian leaders have rejected negotiations under what they describe as coercion. Parliament Speaker Mohammad Bagher Ghalibaf accused Washington of trying to force a surrender through military and economic pressure. He warned that Iran had prepared new military options if the situation escalates.
The Islamic Revolutionary Guard Corps has also issued warnings, saying any vessel attempting to pass through the Strait of Hormuz without permission could be targeted. The waterway is a critical route for global energy supplies, carrying roughly one-fifth of the world’s oil exports.
As the ceasefire approaches its expiration, fears are growing that the fragile pause in fighting could collapse. Oil markets remain sensitive to developments, with prices still elevated despite easing from pre-ceasefire peaks. Brent crude was trading just above $95 per barrel on Tuesday, reflecting ongoing uncertainty.
With both sides maintaining hardline positions and no confirmed timeline for renewed talks, the risk of further conflict remains high. The outcome of the stalled negotiations is likely to have significant implications not only for the region but also for global energy markets and economic stability.
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Iran Says Hormuz Can Reopen Within Seven Days as Oil Exports Come Under Pressure
Iran’s military said it retained full control of the Strait of Hormuz on Monday, while Foreign Minister Abbas Araghchi said the strategic waterway could be fully reopened within seven days if Tehran’s conditions were met and hostile measures against the country were lifted.
The statements came as Iran faced growing economic pressure, with the rial falling to record lows, Oil Minister Mohsen Paknejad resigning and the United States claiming that Tehran had not loaded any crude onto tankers during September.
Brigadier General Aziz Jafari, commander of Iran’s Khatam al-Anbiya Joint Air Defence Headquarters, said all movements through the Strait remained under the control of the Iranian armed forces despite changes in US tactics.
“All movements (in Hormuz) are under the control of the armed forces of the Islamic Republic,” Jafari said.
US Treasury Secretary Scott Bessent said on Thursday that Iran had not loaded crude oil onto tankers during September, arguing that the Trump administration was targeting Tehran’s main source of revenue.
Iranian President Masoud Pezeshkian acknowledged in August that restrictions were disrupting oil exports, saying the country had previously been able to sell oil but was now unable to do so at the same level.
Paknejad’s resignation was officially attributed to family and personal matters. However, his departure came amid speculation about the impact of reduced oil exports on government finances. Before his resignation was announced, Paknejad said in a video carried by Iranian media that revenue from oil already sold would be collected and that the process would continue.
The acting oil minister has pledged to maximise production and maintain exports through new strategies.
Despite pressure on Iranian exports, oil shipments from other parts of the region remained high. Ship-tracking company Kpler estimated crude exports from the region excluding Iran at between 19.5 million and 22.5 million barrels per day during the final week of September, compared with a pre-war regional average of about 18 million barrels per day.
Iran’s currency has also come under severe pressure. The euro rose above 300,000 tomans on the informal market, while the US dollar reached 270,000 tomans, more than double its level of about 135,000 tomans at the beginning of the year. One toman is equal to 10 rials.
The UK Maritime Trade Operations agency reported at least one attack each day in the Strait of Hormuz or the Gulf of Aden since October 2.
Araghchi told foreign ambassadors in Tehran that the conflict could not be resolved militarily and called for negotiations based on fairness. He warned that any renewed military confrontation would trigger a stronger Iranian response.
Parliament Speaker Mohammad Bagher Ghalibaf said Tehran had received US proposals through intermediaries but rejected what he described as one-sided demands.
He said the Strait would remain closed until Iran’s seven conditions, based on the Islamabad memorandum, were met.
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