(Bloomberg) — Iran offered its response to its latest U.S. proposal to end the 10-week war as a series of events continue to threaten a shaky ceasefire.
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The state-run Islamic Republic News Agency reported the latest reaction without providing further details, and Tehran has yet to give any public indication that it would accept Donald Trump’s plan. The US president suggested that Iran allow passage through the Strait of Hormuz and that Washington lift the blockade of Iranian ports next month.
The US offer means Iran has agreed to end the conflict in the Middle East that has killed thousands of people and caused energy prices to rise. The two sides will then need to reach an agreement on Iran’s nuclear program, which remains a critical sticking point.
Trump had warned that the United States “may go a different route if everything is not signed, if everything is not blocked,” touting an expanded version of Project Freedom, the brief U.S. effort to break Iran’s naval pressure and escort ships from Hormuz. Before the conflict began, about a fifth of the world’s oil and liquefied natural gas flowed through the waterway.
Israeli Prime Minister Benjamin Netanyahu warned that the war was “not over.” More work is needed to dismantle Iran’s nuclear capacity and eliminate its stockpile of highly enriched uranium, he said in an interview on CBS’ 60 Minutes on Sunday.
Despite a ceasefire in place since April 8, a drone strike on Sunday briefly set fire to a cargo ship off the coast of Qatar in the Persian Gulf, marking the latest shipping attack in the region.
The United Arab Emirates and Kuwait, both of which have come under attack from Iran in the past two months, announced on Sunday that they had captured enemy UAVs.
Iran’s Deputy Foreign Minister Kazem Garibabadi also warned Britain and France in a post on channel X that the presence of warships in the Strait of Hormuz would be met with “a determined and urgent reaction by the armed forces of the Islamic Republic of Iran.”
The conflict, which began with the US-Israeli attack on Iran on February 28, has disrupted oil and gas markets as rising fuel prices put pressure on governments and consumers around the world, including the US, ahead of midterm elections in November.
Saudi Aramco, the world’s largest oil company, warned on Sunday that even if the Strait of Hormuz reopened immediately, it would take several months for the market to return to normal.
“If trade and transport are disrupted for more than a few weeks from today, we foresee that the supply disruption will continue and the market will return to normal only in 2027,” Chief Executive Officer Amin Nasser said in a statement.
As the crisis continues, the Gulf’s largest economies are adapting and finding ways to bring at least some of their energy production to the market.
Ship tracking data compiled by Bloomberg showed that the tanker Al Kharaitiyat, carrying Qatar’s liquefied natural gas, passed through Hormuz this weekend. This marked Qatar’s first exports outside the region since the start of the crisis and was destined for Pakistan, a key mediator in US-Iran peace talks.
The shipment is part of Pakistan’s negotiations with Iran to help it buy extra Qatari LNG cargo and meet urgent demand, according to people familiar with the matter who asked not to be named because the talks are private.
Meanwhile, according to Bloomberg’s report on Friday, Aramco and UAE’s state oil company Adnoc are among the companies that have been carrying crude cargo through the strait since Iran effectively closed the strait.
Other Saudi exports were diverted to the Red Sea via pipeline. Aramco took this alternative route on Sunday, reporting a 26% increase in first-quarter profit after a war-induced rise in oil and refined fuel prices.
Global benchmark Brent crude rose on Friday to settle around $101 a barrel, but still posted a weekly decline of about 6%.
U.S. Energy Secretary Chris Wright signaled Sunday on NBC’s Meet the Press that the United States may prioritize reopening Hormuz over demanding an end to Tehran’s nuclear program.
Asked about the possibility of an interim agreement that might not fully resolve the nuclear issue, he said: “Of course, this should be possible.”
More related to war:
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Iran has denied a New York Times report that there was an oil spill around Kharg Island in the Gulf. The official Shana news agency quoted an oil terminal official as saying there were no leaks in infrastructure, storage tanks, pipelines or ships.
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Iran’s Supreme Leader Mojtaba Khamenei met with a senior military official and issued “new instructions” to confront his enemies, according to another state news agency. There was no appearance of Khamenei, who has not been seen or heard from the public since his inauguration in March.
–With assistance from Sara Gharaibeh, Tony Czuczka, Angela Cullen and Eltaf Najafizada.
(Updates on the Netanyahu interview, Iranian official’s statements starting from the fifth paragraph.)
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