WASHINGTON/DUBAI/ISLAMABAD, April 29 - The United States is encouraging other nations to create an international coalition aimed at restoring navigation freedom in the Strait of Hormuz. This push comes as oil prices hav...
WASHINGTON/DUBAI/ISLAMABAD, April 29 - The United States is encouraging other nations to create an international coalition aimed at restoring navigation freedom in the Strait of Hormuz. This push comes as oil prices have surged to their highest levels in over four years due to concerns about ongoing disruptions to global fuel supplies, as reported by a State Department cable viewed by Reuters.
Two months into the conflict triggered by U.S. and Israeli strikes on Iran, this key maritime route remains shut, cutting off 20% of the world's oil and gas supplies. This situation has caused energy prices to rise dramatically and has increased worries about a possible economic downturn.
The resolution of the conflict has stalled, and the U.S. is attempting to break this deadlock with a naval blockade of Iran's oil exports, which are essential for the country's economy.
With negotiations at a standstill, President Donald Trump is expected to receive a briefing on plans for new military strikes against Iran, hoping to bring them back to the negotiating table, according to an Axios report published late Wednesday.
This news has resulted in a spike in oil prices, with the benchmark Brent crude contract priced above $125 a barrel at one point, partly due to technical aspects related to the contract's expiration later on Thursday.
Since the beginning of the year, Brent prices have more than doubled and reached their highest level since March 2022, contributing to inflation and pushing gas prices to uncomfortable levels worldwide.
Iran has vowed to keep disrupting maritime traffic through the Strait as long as it feels threatened, which could lead to more disruptions to oil supplies from the Middle East amid a conflict that has already resulted in numerous casualties.
Tehran warned on Wednesday of "unprecedented military action" if the U.S. continues its blockade of ships linked to Iran. Trump has stated that Iran must not develop nuclear weapons, while Tehran insists its nuclear ambitions are for peaceful purposes.
"They don’t know how to sign a non-nuclear deal. They’d better get smart soon!" Trump stated in a social media post on Wednesday, without clarifying what a deal would entail.
The post included a staged image of Trump wearing sunglasses and holding a machine gun, captioned "No more Mr. Nice Guy."
As Washington and Tehran exchange public threats, mediator Pakistan is working to avoid further escalation while both sides discuss a potential deal, as noted by a Pakistani source on Wednesday.
On Tuesday, Trump met with oil industry executives, discussing measures he has taken to ease global oil market pressures and potential actions to sustain the blockade for as long as necessary while minimizing effects on U.S. consumers, according to a White House official.
URANIUM DISPUTE, ECONOMY UNDER PRESSURE
The ongoing conflict has so far cost the U.S. military $25 billion, marking the first official estimate of the war's financial impact, according to a senior Pentagon official.
The State Department cable indicated that the United States is inviting other countries to join a new international coalition to restore shipping in the Strait of Hormuz, which has seen a major slowdown in traffic.
The proposed coalition, called the "Maritime Freedom Construct," aims to share intelligence, coordinate diplomatic efforts, and help enforce sanctions, as per the cable.
Countries like France and Britain have discussed contributing to this coalition but are willing to assist only after hostilities have ceased.
Iran seeks U.S. recognition of its right to enrich uranium for what it claims are peaceful, civilian purposes. The country currently holds about 440 kg (970 lbs) of uranium enriched to 60%, which could be refined further for nuclear weapons.
Iran's parliament speaker and chief negotiator, Mohammad Baqer Qalibaf, accused Trump of trying to divide the Iranian people and force them to submit through the blockade.
"The only solution to confront the enemy’s new conspiracy is maintaining unity, which has always thwarted their plots," Qalibaf stated in an audio message via Telegram.
Since the war began with the U.S. and Israel two months ago, Iran has executed at least 21 people and arrested over 4,000 on national security-related charges, according to U.N. human rights chief Volker Turk.
In a reflection of the war's impact on Iran's economy, the Iranian currency dropped to an all-time low on Wednesday, as reported by the Iranian Students' News Agency. Inflation reached 65.8% for the month ending April 20, as reported by the central bank.
IRAN WANTS FORMAL END TO CONFLICT FIRST
Iran's latest proposal to resolve the war, which has been on hold since April 8 due to a ceasefire, suggests postponing discussions on its nuclear program until after the conflict is formally resolved and shipping issues are addressed.
This proposal does not satisfy Trump’s demand to prioritize discussions on the nuclear issue.
A Pakistani source mentioned that the U.S. has provided "observations" regarding the Iranian proposal, leaving the next move to Iran.
"The Iranians have requested until the end of the week to respond," the source told Reuters.
U.S. intelligence agencies, directed by senior officials, are analyzing how Iran might react if Trump were to declare unilateral victory, according to two U.S. officials and someone familiar with the matter.
Since the U.S. and Israel began airstrikes on Iran on February 28, Tehran has largely blocked all shipping except its own from the Gulf through the Strait of Hormuz. The U.S. initiated its blockade this month.
Irán's leadership structure has changed following the strikes, which killed several senior figures, including Supreme Leader Ayatollah Ali Khamenei. The rise of Khamenei's injured son, Mojtaba, has given more power to hardline commanders within the Islamic Revolutionary Guard Corps, according to Iranian officials and analysts.
Meanwhile, Trump is facing domestic pressure to end a war for which he has provided varying justifications to a U.S. population grappling with rising gasoline prices.
His approval ratings have dropped to their lowest point of his current term, as shown by a recent Reuters/Ipsos poll.