DUBAI/WASHINGTON, May 11 - President Donald Trump moved quickly to dismiss Iran’s reply to a U.S. proposal intended to reopen negotiations, writing on social media that he found Tehran’s response "I don’t like it - TOTALLY UNACCEPTABLE," without offering further detail. The public rebuke followed a response from Iran that reiterated demands it said were central to ending the 10-week-old conflict.
Iran’s statement, carried by state television, centred on a call to stop fighting on all fronts, with particular emphasis on Lebanon, where Israel is engaged with Iran-backed Hezbollah militants. Iranian outlets and semi-official media also said Tehran sought compensation for war damages and reaffirmed its sovereignty claims over the Strait of Hormuz. The semi-official Tasnim news agency additionally said Iran asked the United States to end its naval blockade, guarantee there would be no further attacks, lift sanctions and lift a U.S. ban on Iranian oil sales.
The U.S. peace offer, circulated days earlier, had proposed an initial cessation of hostilities before addressing more divisive matters, including Iran’s nuclear program. Instead, the rapid public exchange of positions has left the narrow waterway that sits at the heart of global oil flows largely paralysed and markets jittery.
On Monday, the continuing impasse corresponded with a roughly $3-per-barrel rise in oil prices as traders responded to the prospect of sustained disruption in a strait that, prior to the conflict, had carried one-fifth of the world’s crude shipments. The flow of tanker traffic through the Strait of Hormuz has emerged as one of the central pressure points of the war.
Political ramifications in the United States are also in play. Opinion surveys indicate the conflict is unpopular with U.S. voters already contending with significantly higher gasoline prices, and that discontent comes less than six months before nationwide elections that will shape whether Trump’s Republican party retains control of Congress.
On the diplomatic front, the United States has struggled to secure broader backing for unilateral action to reopen the strait. NATO allies have declined calls to dispatch vessels to clear the waterway without a comprehensive peace agreement and an internationally mandated mission, leaving Washington’s options constrained. It remains unclear what additional diplomatic or military steps Washington might pursue next.
Trump is scheduled to travel to Beijing on Wednesday, and the conflict with Iran is expected to be among the issues discussed with Chinese President Xi Jinping. The White House has been pressing China to leverage its influence over Tehran to prod Iran toward a deal with Washington.
Speaking publicly about whether combat operations against Iran had concluded, the president said in remarks aired on Sunday: "They are defeated, but that doesn’t mean they’re done." Israeli Prime Minister Benjamin Netanyahu echoed a similar caution, arguing the conflict was not over because there remained "more work to be done" to eliminate enriched uranium in Iran, dismantle enrichment facilities and confront Iran’s proxies and ballistic missile capabilities.
In the same interview, which aired Sunday on CBS News’ "60 Minutes," Netanyahu described diplomacy as the preferred route to remove enriched uranium but did not exclude military options. Iran’s President Masoud Pezeshkian, in a social media post, said his country would "never bow down to the enemy" and would "defend national interests with strength."
Even as talks and back-channel efforts have been reported, the operational threat to shipping lanes and regional economies remains elevated. Recent days have seen some of the fiercest clashes in and around the Strait of Hormuz since a ceasefire was declared. The United Arab Emirates reported intercepting two drones originating from Iran. Qatar publicly condemned a drone strike that hit a cargo ship sailing from Abu Dhabi within Qatari waters. Kuwait said its air defences engaged hostile drones that had entered its airspace.
Hostilities have also persisted in southern Lebanon, where Israeli forces and Hezbollah fighters have clashed despite a U.S.-brokered ceasefire announced on April 16. Netanyahu warned that even if hostilities with Iran were to be resolved, the conflict in Lebanon might continue, reflecting the multiple fronts on which the wider confrontation has unfolded. He also acknowledged that Israeli planners had initially underestimated Iran’s capacity to disrupt traffic through the Hormuz Strait, saying: "It took a while for them to understand how big that risk is, which they understand now."
Summary
President Trump publicly rejected Iran’s reply to a U.S. peace proposal, calling it "totally unacceptable." Iran’s response demanded cessation of fighting on multiple fronts, compensation, and recognition of its sovereignty over the Strait of Hormuz while seeking an end to the U.S. naval blockade and sanctions. The impasse has coincided with a notable spike in oil prices and persistent threats to shipping in the Strait of Hormuz.
Key points
- U.S.-Iran diplomatic exchange: The U.S. proposed ending hostilities before negotiating divisive issues; Iran countered with demands that included ending fighting on all fronts and restoring Iranian control claims over the Strait of Hormuz.
- Market impact: The stalemate contributed to a roughly $3-per-barrel rise in oil prices as the Strait of Hormuz, once carrying one-fifth of global oil flows, remains largely closed.
- Political and security consequences: The conflict is politically sensitive in the U.S. ahead of nationwide elections and has not drawn NATO support for unilateral naval action to reopen the strait without a broader peace mandate.
Risks and uncertainties
- Continued shipping disruptions - Energy and shipping sectors face elevated risk if the Strait of Hormuz remains shut or threatened by further military incidents.
- Escalation on multiple fronts - Ongoing clashes in Lebanon and drone incidents near the strait could prolong regional instability, affecting defence and insurance costs for maritime trade.
- Limited international consensus - Without broad allied support for operations to secure shipping lanes, diplomatic deadlock could persist, sustaining price volatility in oil markets and complicating political calculations ahead of elections.
Disclosure
No disclosures.