U.S. and Iran Agree to Two-Week Ceasefire as Strait of Hormuz Reopens
The world is breathing a sigh of relief after a tense few days in the Middle East. The U.S. and Iran have agreed to a two-week ceasefire; however, there are still many questions about what happens next in the ongoing conflict. Here is a look at the latest response coming from the White House and out of the Middle East.
U.S. and Israeli Response to the Two-Week Ceasefire with Iran
The U.S. and Iran negotiated a two-week ceasefire on Tuesday. The deal came less than two hours before U.S. President Donald Trump's deadline that threatened to wipe out a "whole civilization" if Iran did not cooperate. On the surface, the president's threats worked to temporarily ease the escalating tensions. However, that does not mean that the conflict is over between the two warring nations.
At the very best, the temporary truce is a starting point to launch further negotiations. The primary point of contention is what happens with the Strait of Hormuz. This 30-mile-wide strait connects the Persian Gulf with the Gulf of Oman, serving as a key passageway for about 25% of the world's seaborne oil trade. The war triggered a global oil disruption in recent weeks as Iran shut down access to the choke point.
Trump first announced the ceasefire in a Truth Social post on Tuesday evening. The president confirmed that the truce was reached on the condition that Iran reopen the Strait of Hormuz. The details of the ceasefire were worked out by Pakistan's prime minister and military chief. According to Trump, the 10-point truce proposed by Iran is "a workable basis on which to negotiate." Trump said that a final agreement will be worked out during the next two weeks.
U.S. Vice President JD Vance said that the ceasefire was a "fragile truce." This is in contrast to Trump's reaction, calling the deal a "total and complete victory." Trump would not confirm if he would carry through with his threats to destroy the civilian infrastructure holding up Iran's capital city of Tehran.
A few hours after announcing the truce, Trump took to social media again to say that the U.S. would be assisting with the buildup of traffic back through the Strait of Hormuz. He noted that "big money will be made."
It is being reported that the Trump administration is going to participate in in-person negotiations with Iran. These talks are likely to be held in Islamabad under the direction of Pakistan's prime minister. Vice President Vance, special envoy Steve Witkoff, and Jared Kushner are expected to represent the U.S. beginning on Saturday.
Israel was also part of the ceasefire, agreeing to suspend its military campaign against Iran. However, the office of Israeli Prime Minister Benjamin Netanyahu said that Lebanon is not included in the ceasefire. Israel has continued to launch strikes at Lebanon on Wednesday, despite Pakistan's prime minister saying that Lebanon was included in the truce package.
Response from Iran
On the other side of the conflict, Iran’s Foreign Minister Abbas Araghchi said that his nation will stop its military action should the U.S. and Israel hold up to their end of the bargain. Araghchi also said that Iranian military forces will facilitate safe passage through the Strait of Hormuz during the two-week ceasefire.
Meanwhile, Iran's Tasnim News Agency is reporting that Iran and Oman will charge transit fees for vessels using the strait over the next two weeks. The funds collected will reportedly be used for reconstruction.
While Trump was claiming that the truce was a victory for the U.S., Iran’s Supreme National Security Council had a different message. The nation's top security body claimed that it had forced the U.S. to accept its plan and called the ceasefire an “enduring defeat” for the White House. This statement confirmed the plan to hold negotiations in Islamabad.
Araghchi also noted that his country was considering a 15-point proposal submitted by the U.S. Although the details of this proposal have not been released, some of the tenets have been leaked. The U.S. is reportedly asking for Iran to commit to no use of nuclear weapons, an end to regional proxy groups, turning over its highly enriched uranium stores, and acknowledging Israel's right to exist.
Likewise, the White House has not released the details of Iran's 10-point proposal. However, multiple Iranian state media outlets have leaked the content of the proposal. The Iranian demands include its right to regulate passage for foreign vessels through the Strait of Hormuz, the easing of international sanctions, the unfreezing of assets, the end to the attacks on Iran, and the withdrawal of American military forces from the region. The 10-point proposal also includes the requirement of a binding United Nations resolution to secure a long-term peace deal.
There have been reports that Iran is demanding that it retain its right to nuclear enrichment. The Iranian embassy in India included this condition in its breakdown of the 10 points.
The good news now is that oil prices are beginning to drop significantly on the news of the ceasefire. West Texas Intermediate, the crude oil benchmark used in the U.S., dropped 16.41% to land at $94.41 per barrel. While this is a notable drop, crude oil was hovering at $67 per barrel when the war began.
Brent crude, the global benchmark, fell 13.29% to settle at $94.75 per barrel. This marked its lowest settle price since March 11; however, it is still well over the $73 per barrel price on February 27.
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