Mediation gains momentum yet gaps remain

Pakistani officials are engaged in "intense mediation activity" to narrow the gaps between Iran and the United States for a deal to end the conflict, Iranian media reported on Friday. While the two sides have exchanged messages and draft texts, key disagreements remain unresolved.

Two days after conveying Washington's latest proposal to Iran, Pakistani Interior Minister Syed Mohsin Naqvi held another round of diplomatic talks with Iranian Foreign Minister Abbas Araghchi in Tehran, according to Iran's semiofficial Tasnim News Agency.

US Secretary of State Marco Rubio told reporters on Thursday there had been "some good signs" in the talks, but there could be no solution if Tehran imposes a tolling mechanism in the Strait of Hormuz, which it effectively closed to most shipping after the war began on Feb 28.

"There's some good signs," Rubio said. "I don't want to be overly optimistic … So, let's see what happens over the next few days."

A ceasefire reached on April 8 halted the US-Israeli military offensive launched weeks earlier, yet diplomatic efforts, including landmark face-to-face talks hosted in Islamabad, have yet to deliver a durable settlement.

A senior Iranian source told Reuters on Thursday that bilateral differences have narrowed, with uranium enrichment and governance of the Strait of Hormuz remaining core sticking points.

US President Donald Trump said on Thursday that the US would eventually seize Iran's stockpile of highly enriched uranium, while Iranian Supreme Leader Mojtaba Khamenei has issued a clear directive banning the overseas transfer of the nuclear material.

"We will get it. We don't need it, we don't want it. We'll probably destroy it after we get it, but we're not going to let them have it," Trump told reporters.

Domestic pressure

Facing domestic pressure ahead of the November midterm elections, Trump also railed against Tehran's intentions to charge fees on ships using the Strait of Hormuz. "We want it open, we want it free. We don't want tolls. It's an international waterway."

Tehran submitted its updated proposal to Washington earlier this week. The terms largely reiterate demands previously rejected by Trump, including Iranian oversight of the vital waterway, war compensation, sanctions relief, unfreezing of overseas assets and the withdrawal of US military forces from the region.

Tehran was on alert for the possibility of renewed armed conflict, with Parliamentary Speaker Mohammad Bagher Ghalibaf warning Washington on Wednesday of a "forceful response" if Iran were to be attacked.

While it remains unclear when the two sides might reach an agreement, experts said any breakthrough is more likely to come later rather than sooner.

When asked whether Tehran will agree to the latest US proposal, Michael O'Hanlon, senior fellow in Foreign Policy at the Brookings Institution, told Xinhua News Agency: "It feels to me like the two sides are both still far apart. I am guessing some kind of lasting settlement by summer, not spring."

Though open warfare and strikes across the Gulf have reduced, the impasse continues to weigh on the world economy, with the surge in oil prices stoking fears of rampant inflation. Traffic through the strait has fallen to a trickle compared with 125 to 140 daily passages before the war.

"We're coming to the end of week 12, we're six weeks into the ceasefire, and I'm just not really that convinced we're any closer to a resolution between the US and Iran," said Tony Sycamore, a market analyst at IG.

The International Energy Agency said on Thursday that the conflict has produced the world's worst energy shock, warning that the peak of summer fuel demand, coupled with a lack of new supply from the Middle East, meant the market could enter the "red zone" in July and August.

In another development, a new poll from The New York Times/Siena showed that nearly three-quarters of US voters aligned with the Democratic Party oppose military aid to Israel, up from 45 percent three years ago.

The poll also found that nearly half of Democratic voters believe their party is overly supportive of Israel, while 95 percent oppose the US-Israeli war against Iran.