A fragile ceasefire between the United States and Iran is set to expire within days, and negotiations held over the weekend in Islamabad ended without a deal, leaving nearly 92 million Iranians — and global energy markets — in a state of deep uncertainty. U.S. President Donald Trump has since imposed a naval blockade on the Strait of Hormuz, the narrow waterway between Iran and the Arabian Peninsula through which roughly 20% of the world's oil and liquefied natural gas passes, sharply raising the stakes ahead of any resumed talks.
In Tehran, the atmosphere is one of tense suspense. Civilians who endured six weeks of U.S. and Israeli airstrikes are anxious about whether conflict will resume, with many openly questioning whether Washington might escalate further. Support for the Iranian armed forces has grown even among citizens who opposed the government domestically, while those who had hoped for U.S.-backed regime change have fallen conspicuously silent. Iranian Foreign Minister Abbas Araghchi said Tehran came "just inches away" from signing a memorandum of understanding in Islamabad, blaming the collapse on Washington shifting its demands at the last moment — a charge the U.S. side has not publicly addressed. Iranian officials say they remain open to further talks but are also prepared to resume hostilities if necessary.
On the American side, Vice President JD Vance signalled that Trump is pursuing far more than a nuclear freeze. Speaking at the University of Georgia, Vance said Trump wants a "grand bargain" — a comprehensive agreement under which Iran abandons its nuclear programme, ends its designation as a state sponsor of terrorism, and integrates into the global economy. During the Islamabad talks, the U.S. reportedly proposed a 20-year suspension of all Iranian nuclear activity; Iran countered with five years. Trump himself distanced himself from the 20-year figure, reiterating his core demand: Iran cannot have nuclear weapons.
The blockade, which U.S. Central Command has clarified applies specifically to Iranian ports rather than all shipping through the strait, is widely seen as a pressure tactic. With Iran's military significantly degraded — its drone and missile stockpiles, enrichment facilities, and senior leadership all suffering serious damage — control of the strait is now Tehran's primary remaining source of leverage. Iran had been charging tolls for safe passage through what it considers its territorial waters, a practice the U.S. deems illegal. Analysts note the blockade also serves to limit Chinese access to Iranian oil; Beijing purchases nearly 40% of the oil transiting Hormuz and is Iran's largest crude buyer, giving Washington additional leverage ahead of anticipated U.S.-China summit talks in May.
The legal dispute over the strait adds another layer of complexity. Iran and the United States do not share a common legal framework for governing the waterway: neither country has ratified the United Nations Convention on the Law of the Sea (UNCLOS), the 1982 treaty that most of the world relies on to define navigation rights. Iran argues it retains significant authority over passage under older international law, while the U.S. insists on the UNCLOS principle of "transit passage" — unrestricted navigation — as customary law. Legal scholars are divided, and this foundational disagreement makes any durable post-war settlement of the strait's status deeply uncertain. For now, both diplomacy and confrontation appear to be advancing simultaneously, with a new round of talks potentially resuming within days.