Iran to Halt Message Exchanges With US Over Israel, Tasnim Says

(Bloomberg) — Iran announced it will stop negotiations with the US in response to Israel's intensified ground offensive in Lebanon, heightening tensions as both countries aim for a temporary peace deal.

According to the semi-official Tasnim news agency, negotiators will pause “talks and the exchange of documents through mediators.”

This news led to a spike in oil prices and a drop in stock markets, with Brent crude rising to about $97 a barrel. Last week, prices had fallen more than 11% as traders were hopeful about a potential agreement.

The US and Iran have been sending indirect messages regarding a draft agreement, which would likely extend their ceasefire by about two months. This deal could involve Iran reopening the Strait of Hormuz while the US lifts the blockade on Iranian ports.

However, Iranian officials stated that Israel's actions over the weekend, which marked its largest military operation in Lebanon in 25 years, violate the ceasefire. Tehran insists that any agreement should address all conflicts in the region, particularly the ongoing war between Hezbollah and Israel in Lebanon.

Mohammad Bagher Ghalibaf, Iran’s Parliament Speaker and chief negotiator, commented earlier that Israel's escalation in Lebanon and the blockade on Iranian ports are “clear evidence of US noncompliance with the ceasefire,” as noted in a social media post.

Iran and the ‘Axis of Resistance’— a term for a coalition of Iran-backed groups in the region— have discussed completely closing the Strait of Hormuz and the Bab al Mandeb Strait, according to the Tasnim report.

The Bab El-Mandeb Strait, which connects the Red Sea to the Gulf of Aden, is a crucial transit route to the Suez Canal that links Europe, the Middle East, and Asia. Attacks by the Iran-backed Houthis prior to the Gaza ceasefire had significantly disrupted shipping in this area.