- Trump said the U.S. is in the “final stages” with Iran, sparking a Treasuries rally and oil selloff — then threatened to resume attacks “in the coming days” if Iran doesn’t accept his terms, reversing the market moves.
- Iran’s Islamic Revolutionary Guard Corps warned that any renewed U.S. or Israeli strikes would trigger retaliation “beyond the region,” with “crushing blows in places you do not expect.”
- The core deadlock remains: the U.S. demands Iran surrender nuclear enrichment capabilities and fully reopen the Strait of Hormuz; Tehran insists the U.S. end its port blockade first.
- The IRGC claimed 26 ships passed through Hormuz in a single day with Iranian coordination — still far below pre-war traffic levels but a signal Tehran wants to assert control over the strait’s reopening on its own terms.
What Happened?
President Trump told reporters Wednesday that the U.S. is in the “final stages” of negotiations with Iran — comments that sent Treasuries surging and oil prices falling more than 5%. Within hours he undermined the optimism, threatening to resume attacks if Iran doesn’t agree to his terms: “We’ll either have a deal or we’re going to do some things that are a little bit nasty.” Iran’s IRGC responded by warning that any renewed strikes would expand the conflict beyond the Middle East, vowing retaliation in “places you do not expect.” Iranian President Pezeshkian posted on X that forcing Iran to surrender through coercion was “nothing but an illusion.” The U.S. military also boarded and searched an Iranian-flagged tanker in the Gulf of Oman before releasing it, saying the vessel was suspected of attempting to violate the American blockade.
Why It Matters?
The day’s whiplash — “final stages,” then “nasty” threats, then IRGC warnings of regional escalation — illustrates precisely why markets remain volatile and energy prices elevated. Trump has now said multiple times that a deal was close, and none has emerged. The credibility cost of another false dawn is real: bond investors remain wary, oil traders are not pricing in a resolution, and key industry players have warned that Hormuz flows won’t fully recover until well into 2027 even if a deal is struck today. The IRGC’s warning of strikes “beyond the region” is a meaningful escalatory signal — Iran still has the capability to target countries from Turkey to the Gulf states, and doing so would transform the conflict from a bilateral standoff into a broader regional conflagration.
What’s Next?
Trump’s envoy Jeff Landry is scheduled to brief the president Thursday on business opportunities in Greenland — but also, presumably, on Iran developments from his travel. The negotiating gap remains wide: Iran will not surrender enrichment capabilities without security guarantees no U.S. administration has offered, and the port blockade demand gives Tehran a concrete ask to leverage. Xi Jinping’s call for “comprehensive ceasefire” during his meeting with Putin in Beijing adds diplomatic pressure but no enforcement mechanism. Watch the energy market — Brent near $106 a barrel remains the most honest real-time gauge of whether traders believe a deal is actually close.
Source: Bloomberg
