U.S.-Iran Peace Talks Collapse as Trump Orders Strait of Hormuz Blockade

TLDR

• U.S. and Iran ended 21 hours of talks in Pakistan without a deal
• VP JD Vance said Iran refused to commit to not pursuing a nuclear weapon
• Trump announced the U.S. Navy will immediately blockade the Strait of Hormuz
• The strait carries roughly one-fifth of global oil and LNG supplies
• Oil markets are expected to open higher Monday following the breakdown

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The U.S. and Iran walked away from peace talks in Islamabad, Pakistan on Sunday without reaching an agreement, ending 21 hours of negotiations that failed to bridge key differences.

Vice President JD Vance led the American delegation. He said Iran would not commit to abandoning its nuclear weapons program, which he described as a core U.S. demand.

“We’ve made our red lines as clear as we possibly could, and they have chosen not to accept our terms,” Vance told reporters in Islamabad early Sunday.

Iran’s foreign ministry said it was natural that differences wouldn’t be resolved in one round of talks. Spokesman Esmail Baghaei said “diplomacy never ends” and left the door open for further discussions.

The talks covered three main areas: control of the Strait of Hormuz, a potential ceasefire extension, and phased sanctions relief. Iran’s semi-official media said U.S. demands were “excessive.”

Iran has kept vessel traffic through the Strait of Hormuz at a standstill since the U.S.-Israeli war began in late February. The waterway handles about one-fifth of global oil and liquefied natural gas supplies.

Two empty supertankers tried to pass through the strait on Sunday. Both turned back just as the peace talks ended.

Trump Orders Blockade

Hours after the talks fell apart, President Trump posted on Truth Social announcing the U.S. Navy would immediately begin blockading the Strait of Hormuz.

Trump also said the Navy would intercept any vessel in international waters that had paid a toll to Iran. “No one who pays an illegal toll will have safe passage on the high seas,” he said.

Trump said the meeting “went well” and that “most points were agreed,” but confirmed the two sides could not align on Iran’s nuclear program.

Oil Markets Brace for Monday Open

Analysts expect oil and gas prices to jump when markets open Monday. Nick Twidale, chief market analyst at AT Global Markets in Sydney, said hope had been building last week ahead of the talks.

The two-week ceasefire, reached last week, is now in a fragile state. Pakistan, which hosted the talks, called them “constructive” and said it would continue facilitating discussions.

The war has killed more than 5,600 people across Iran, Lebanon, and neighboring countries. Thirteen American troops have died, according to U.S. Central Command.

Israel’s Prime Minister Benjamin Netanyahu said enriched nuclear material should be removed from Iran with or without a deal.

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