Nearly two months into a ceasefire between US-led coalition forces and Iran, hopes for a diplomatic breakthrough have moved forward slightly after Tehran delivered a new negotiating proposal to Washington via Pakistani mediators, Iranian state media confirmed Friday.
According to Iran’s official IRNA news agency, the full text of the proposal was transferred to Islamabad for onward transmission to US officials on Thursday evening. This development comes after the only completed round of direct peace talks between the two parties ended without progress, even as a cessation of active hostilities has held since April 8. The conflict, launched on February 28 via a surprise joint strike campaign by the United States and Israel, has paused on the battlefield but left a tangled web of economic blockades that are roiling global markets.
A key point of ongoing friction remains control of the Strait of Hormuz, a critical chokepoint for 20% of the world’s daily oil trade. Iran has continued its restrictions on commercial shipping through the strait, cutting off millions of barrels of oil, natural gas, and fertilizer supplies from global markets. In response, Washington has enforced a full counterblockade of Iranian ports. The Wall Street Journal reported Thursday that US President Donald Trump has instructed national security officials to prepare for the standoff to extend through coming months, a revelation that immediately pushed up global crude prices.
Speaking in a video published by Iran’s judiciary website Mizan Online, top Iranian judicial official and senior cleric Gholamhossein Mohseni Ejei reaffirmed Tehran’s position on negotiations this week. “The Islamic Republic has never shied away from negotiations,” he said, while adding that Iran would never accept externally imposed terms for a peace deal. Ejei also stressed that Tehran has no interest in resuming full-scale conflict. “We do not welcome war in any way; we do not want war, we do not want its continuation,” he added.
Even with the ceasefire holding, global markets have remained roiled by the uncertainty of the prolonged standoff. Crude oil prices remain more than 50% higher than pre-conflict levels, as traders price in extended disruption to Hormuz shipping. The European Central Bank opted this week to hold interest rates steady, driven by new concerns that sustained energy price hikes could reignite global inflation.
Domestically, the conflict has amplified political and economic pressure on both sides. In Washington, a bitter legal debate over war powers has broken out, centered on a 60-day deadline for the president to secure congressional authorization for military action under the War Powers Resolution. Trump administration officials, including Defense Secretary Pete Hegseth, argue that the ceasefire has paused the clock on the deadline, claiming active hostilities that began on February 28 have formally ended for the purposes of the law. But critics have pushed back on the claim, and Trump faces growing discontent over the conflict, which has coincided with rising domestic inflation, slower-than-expected economic growth, and looming November midterm elections. US government data released Thursday put national inflation at 3.5%, well above policymakers’ target levels.
For Iran, the conflict has compounded economic hardship that built up over years of harsh international sanctions. The US Pentagon reported this week that its counterblockade has prevented Iran from exporting $6 billion worth of oil since the conflict began. Iran’s national statistics center shows that domestic inflation, already above 45% before the war, has climbed to 53.7% in recent weeks.
“For many people, paying rent and even buying food has become difficult, and some have nothing left at all,” Mahyar, a 28-year-old Iranian resident who spoke to AFP on condition of safety, said. He added that the private company he works for has laid off 34 staff, roughly 40% of its total workforce, amid the economic downturn.
On the diplomatic front, Washington has moved forward this week with plans to launch a new international shipping coalition, branded the “Maritime Freedom Construct”, to restore commercial traffic through the Strait of Hormuz. Trump has repeatedly criticized US allies for dragging their feet on coalition efforts to reopen the waterway. Previously, France and Britain had organized a broader international coalition that pledged to support reopening Hormuz only after a diplomatic peace deal is reached.
After the US announcement of its separate coalition, French Foreign Minister Jean-Noel Barrot sought to downplay tensions between the two initiatives during a visit to the Gulf this week. Barrot said the two coalitions have different mandates and will complement rather than compete with one another. “The US mission is not of the same nature as the one we established… it comes as a sort of complement,” he explained.