Overview
Iran has acknowledged receiving a U.S. ceasefire proposal transmitted via third parties but rejects the characterization that formal talks are underway to end almost four weeks of hostilities, Iran's foreign minister said. U.S. President Donald Trump, speaking separately, described Iran's leadership as eager to reach a deal, while warning that Tehran's officials fear reprisals from both their own population and U.S. forces.
What Iran says
Iranian Foreign Minister Abbas Araqchi told state television that no direct dialogue or negotiation has taken place with the United States. He said what has occurred amounts to exchanges of messages using friendly countries as intermediaries. "Messages being conveyed through our friendly countries and us responding by stating our positions or issuing the necessary warnings is not called negotiation or dialogue," Araqchi said. "It is simply an exchange of messages through our friends."
What the U.S. president says
Later on the same day, President Trump told an audience in Washington that Iran's leaders were negotiating and wanted to reach a deal "so badly," but he said they were afraid to acknowledge this publicly because they feared being killed by their own people or by U.S. forces. The president did not identify specific Iranian interlocutors engaged in negotiations.
Human and leadership toll
The fighting has resulted in heavy casualties across the Middle East, with thousands reported killed since the initial U.S. and Israeli attacks on Iran on February 28 and Iran's subsequent strikes on Israel, U.S. bases and Gulf states. Iran's supreme commander, Ayatollah Ali Khamenei, was killed on the conflict's first day by an Israeli strike and replaced by his son Mojtaba. Reports indicate Mojtaba Khamenei has been wounded in subsequent strikes and has not appeared in any photographs or video clips since his appointment.
Wider economic fallout
Market and commercial repercussions have extended far beyond the combat zone. With the Strait of Hormuz - a key shipping channel for roughly a fifth of global oil and liquefied natural gas - effectively closed, the world is experiencing a severe energy shock. Fuel shortages are emerging in multiple regions, and businesses from airlines to supermarkets and used car dealers are confronting rising costs, weakening demand and supply-chain disruption. Governments are considering emergency support measures similar to those deployed during the COVID pandemic.
On the agricultural side, farmers report difficulty sourcing diesel for tractors, and the World Food Programme warns that if the conflict endures into June, tens of millions more people could face acute hunger.
Details of the U.S. proposal
According to three Israeli cabinet sources familiar with the plan, a 15-point U.S. proposal delivered to Iran via Pakistan would require Tehran to remove its stocks of highly enriched uranium, halt enrichment activities, curb its ballistic missile programme and cut off funding to regional allies. The White House declined to make the proposal public and signalled that military pressure could increase.
White House press secretary Karoline Leavitt told reporters that if Iran does not accept that it has been defeated militarily, President Trump will ensure Iran is "hit harder than they have ever been hit before."
Israeli response and regional conditions
Senior Israeli defence officials expressed scepticism that Iran would accept the U.S. terms and voiced concern that U.S. negotiators might concede too much. Israel has also indicated it wants any ceasefire arrangement to preserve its option to conduct pre-emptive strikes. Separately, six regional sources familiar with Iran's stance said Iran has insisted through intermediaries that Lebanon must be included in any ceasefire agreement with the U.S. and Israel.
Market reaction and ongoing strikes
Initial market optimism about a potential ceasefire faded, with global stock gains reversing and oil prices resuming their climb. Tsuyoshi Ueno, senior economist at NLI Research Institute, said optimism regarding a ceasefire had faded, reflecting investor reassessment of the conflict's trajectory.
At the same time, missile and drone strikes continued across the Gulf. The Israeli military reported completing a wide-scale wave of strikes targeting infrastructure in several areas across Iran, following another substantial round of attacks the previous day.
U.S. and allied military claims
Admiral Brad Cooper, the U.S. Central Command chief overseeing forces in the Middle East, said in a video briefing that U.S. forces had struck more than 10,000 targets inside Iran and were diminishing Tehran's capacity to project power externally. Cooper stated that 92% of Iran's largest naval vessels had been destroyed and that its drone and missile launch rates had fallen by more than 90%. He added that U.S. and Israeli operations had damaged or destroyed about two-thirds of Iran's missile, drone and naval production facilities and shipyards.
Meanwhile, Pentagon planning reportedly includes deploying thousands of airborne troops to the Gulf to expand the president's options for a possible ground assault. These deployments would augment two contingents of Marines already en route. Sources said the first Marine unit, aboard a large amphibious assault ship, might arrive around the end of the month.
International warnings
U.N. Secretary-General Antonio Guterres cautioned that the world was "staring down the barrel of a wider war" and urged leaders to cease escalating military actions and to prioritise diplomacy. "It is time to stop climbing the escalation ladder - and start climbing the diplomatic ladder," he said at U.N. headquarters in New York.
Investor and business implications
The interplay of sustained military action, disrupted oil flows through the Strait of Hormuz and uncertainty around any negotiated settlement is driving higher energy costs and complicating supply-chain planning. Companies in transportation, retail and parts-dependent sectors face rising input costs and disrupted delivery schedules. Agricultural producers are already reporting fuel shortages for essential machinery, and humanitarian agencies warn of expanding food insecurity if fighting persists into the northern hemisphere summer months.
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