US-Israel war on Iran

Top negotiator Mohammad Bagher Ghalibaf says US naval blockade of Iran’s ports is ‘a clumsy and ignorant decision’.

Iran’s Islamic Revolutionary Guard Corps Navy (IRGC) says the Strait of Hormuz is closed and that any ship that attempts to pass through the waterway will be targeted, a dramatic reversal less than 24 hours after the critical shipping lane was reopened.

In a statement carried by Iran’s Student News Agency, the IRGC navy said on Saturday the strait will be closed until the United States lifts its naval blockade on Iranian vessels and ports. It said the blockade was a violation of the ongoing ceasefire agreement in the US-Israel war on Iran.

“We warn that no vessel of any kind should move from its anchorage in the Persian Gulf and the Sea of Oman, and approaching the Strait of Hormuz will be considered cooperation with the enemy, and the offending vessel will be targeted,” it said.

Mohammad Bagher Ghalibaf, Iran’s parliament speaker and a senior negotiator in talks between Washington and Tehran on ending the war, said in a television interview that “the Strait of Hormuz is under the control of the Islamic Republic”.

“The Americans have been declaring a blockade for several days now. This is a clumsy and ignorant decision,” he added.

The reassertion of control came just hours after Iran had briefly reopened the strait, in line with a 10-day ceasefire between Israel and Lebanon. Oil prices dropped on global markets after Iranian Foreign Minister Abbas Araghchi said on Friday that the waterway was “completely open for all commercial vessels.”

More than a dozen commercial ships passed through the waterway before the IRGC reversed course.

Iranian gunboats reportedly fired on two commercial ships on Saturday, according to United Kingdom Maritime Trade Operations (UKMTO). India’s Ministry of External Affairs also said that two Indian-flagged ships were involved in a “shooting incident” in the strait.

Some merchant vessels in the region received radio messages from the IRGC Navy, warning that no ships were being allowed through the strait.

US President Donald Trump said Tehran could not blackmail Washington by closing the waterway and warned that he would put an end to the ceasefire if a deal before its expiry on Wednesday is not reached. Trump added that the naval blockade would “remain in full force”.

Iranian Supreme Leader Mojtaba Khamenei, meanwhile, said the navy was ready to inflict “new bitter defeats” on its enemies.

‘Two competing blockades’

Al Jazeera correspondent Zein Basravi said that Iran and the US are back where they were the previous day.

“Less than 24 hours ago, world leaders were praising what they thought was a breakthrough in this conflict, hoping Iran was signalling a confidence-building measure by opening the Strait of Hormuz, potentially leading to a ceasefire deal and a permanent end to the war,” he said.

“As disappointed as people may be, this isn’t entirely surprising. What we’re seeing now is a return to square one,” he added, saying there are now “two competing blockades in place”.

Al Jazeera’s Ali Hashem, reporting from Tehran, said Iran was using the strait to send a message.

“It’s clear that Iran is dealing with a situation in which they are not sure what’s on the table. So the Strait of Hormuz is once again the only space for engagement, even if it’s a negative engagement. And it’s the space where they are sending and conveying messages to the Americans, showing their leverage,” he said.

The world is reckoning with the biggest oil supply disruption in history, one that has sent energy prices soaring, rattled stock markets and exposed the deep vulnerabilities of economies still hooked on fossil fuels. While millions face higher fuel and energy bills, top oil and gas companies are reportedly profiting about $30m per hour since the war began.

This week on UpFront, Redi Tlhabi speaks with renowned economist Mariana Mazzucato about what a genuine green industrial strategy looks like, why the World Bank has fallen short, and how her concept of the “common good economy” offers a new compass for governments navigating crises.

Tehran, Iran – United States President Donald Trump’s announcements about securing major concessions from Tehran have riled supporters of the Iranian establishment, prompting rejections and clarifications from the authorities.

Several current and former senior officials, state media and the Islamic Republic’s hardcore backers expressed anger, frustration, and confusion after the US leader made a series of claims, with days left on a two-week ceasefire reached on April 8.

Trump on Friday said Iran and the US would jointly dig up the enriched uranium buried under the rubble of bombed Iranian nuclear sites, and transfer it to the US. He claimed Iran had agreed to stop enriching uranium on its soil.

He also said the Strait of Hormuz had been opened and would never be closed again, while the US naval blockade of Iran’s ports remained in place, and sea mines were removed or were in the process of being removed.

Trump also emphasised that Iran would not receive billions of dollars of its own frozen assets abroad due to US sanctions, and that the 10-day ceasefire between Israel and Lebanon was completely unrelated to Iran.

Amid Pakistan’s ongoing efforts to mediate another round of negotiations, Iran’s Parliament Speaker Mohammad Bagher Ghalibaf, who led the Iranian delegation to the Islamabad talks earlier this month, rejected all of Trump’s claims.

“With these lies, they did not win the war, and they certainly will not get anywhere in negotiations either,” he posted on X early on Saturday.

By Saturday noon, the Khatam al-Anbiya Central Headquarters of the Islamic Revolutionary Guard Corps (IRGC) released a statement, saying the Strait of Hormuz is once again heavily restricted and under “strict management” of the armed forces. It cited continued “acts of piracy and maritime theft under the so-called label of a blockade” by Washington as the reason.

‘Haze of confusion’

In the hours it took between Trump’s flurry of announcements on Friday and official responses from Iranian authorities, supporters of the establishment voiced serious concerns about any major concessions.

“Is there no Muslim out there to talk to the people a bit about what is happening?!” Ezzatollah Zarghami, a former state television chief and current member of the Supreme Cyberspace Council that controls the heavily restricted internet in Iran, wrote on X.

Alireza Zakani, the hardline mayor of Tehran, said if any of Trump’s claims are true, then the Iranian establishment must beware “not to gift the vile enemy in negotiations what it failed to achieve in the field”.

A fan account on X for Saeed Jalili, an ultrahardline member of the Supreme National Security Council who has opposed any deals with the US for decades, said “dissent” may be at play. It said Supreme Leader Mojtaba Khamenei, who has not been seen or heard from outside of several written statements attributed to him, must release a voice or video message to confirm what is happening.

Jalili’s main account distanced itself from the comment, saying the fan account – which was subsequently deleted – was a sign of “infiltration” by enemies of Iran who were trying to sow discord.

Iranian state media released another written statement attributed to Khamenei on Saturday to mark Army Day, but made no mention of the political drama unfolding hours earlier, or the negotiations with the US.

The dissonance was clearly on display on state television and other state-linked media on Friday, especially those affiliated with the IRGC.

Multiple state television hosts and analysts harshly attacked Foreign Minister Abbas Araghchi because he tweeted on Friday that the Strait of Hormuz was “declared completely open for the remaining period of ceasefire, on the coordinated route as already announced by Ports and Maritime Organisation”.

One of the hosts demanded Araghchi must immediately clarify. Another said the top diplomat’s tweet was in English, and since the Iranian people do not have access to X due to the state-imposed near-total internet shutdown for seven weeks, the message was not directed at the people.

With a huge Hezbollah flag in the background, a furious presenter on state television’s Channel 3 claimed that Araghchi was somehow “the representative of the people of Lebanon, Yemen and Iraq” because they are a part of Iran’s “axis of resistance” of armed forces, so he should demand concessions on their behalf from Trump.

Morteza Mahmoudvand, a representative for Tehran in the Iranian parliament, went as far as saying Araghchi would have been impeached had it not been for “the excuse of war”.

The Fars and Tasnim news sites, which are affiliated with the IRGC, also heavily criticised Araghchi and called for further explanations on Friday evening, with Fars arguing that “Iranian society was plunged into a haze of confusion.”

Armed supporters in the streets

Critical comments from supporters of the Iranian government also flooded social media, including local messaging applications and the comments section of state-run sites.

“We took to the streets every night with clear demands, but you shook hands with the killer of our supreme leader and handed our strait to the Zionists,” one user wrote on Friday in the local app Baleh, in reference to Israel.

“After all these years of sanctions and war and costs imposed on the people, if you are to give up the uranium and the strait, then why did you play with the people’s livelihoods and the blood of the martyrs for so long?” another user wrote.

A large number of analysts and media personalities, including Hossein Shariatmadar, the head of the Kayhan newspaper, who was appointed by late Supreme Leader Ayatollah Ali Khamenei, also voiced criticism and demanded answers on Fars and other outlets.

Regardless of whether there will be more mediated negotiations in Pakistan or whether the war will continue, Iran continues to encourage and arm backers to take to the streets to maintain control.

State media on Friday aired footage of more armed convoys moving through the streets of Tehran while waving the flags of Lebanon’s Hezbollah, Iraq’s Hashd al-Shaabi and other groups. The video below shows women and children crewing heavy machineguns mounted on the back of pick-up trucks during a rally in downtown Tehran.

With no end in sight to the state-imposed internet shutdown that has wiped out millions of jobs in Iran, in addition to steel factories and other infrastructure that were destroyed, the Iranian economy continues to suffer.

The timing of the back-and-forth between Trump and the Iranian officials meant that oil prices dropped before Western markets closed on Friday, and the Iranian currency experienced more volatility.

The rial was priced at about 1.46 million against the US dollar on Saturday morning, the first day of the working week in Iran. But it shot back up to about 1.51 million after the IRGC announced the repeated closure of the Strait of Hormuz.

A maritime agency reported that a tanker was fired on by gunboats in the Strait of Hormuz. The United ⁠Kingdom ⁠Maritime Trade Operations agency says it received a report ⁠of a tanker being fired upon by what it ‌said were two gunboats linked to Iran’s Revolutionary Guard Corps. The vessel and ‌its crew were reported safe.

Reports of Iranian gunboats opening fire on a tanker in strait, after Tehran said it is closing the waterway until the US lifts the blockade of its ports.

Iran says it has closed the Strait of Hormuz again, calling the decision a response to a continued blockade of its ports by the United States.

The Iranian military on Saturday said control of the strategic waterway, through which 20 percent of the global oil flows, has “returned to its previous state”, with reports saying Iranian gunboats fired at a merchant vessel as it attempted to ‌cross.

The closure of the strait came hours after it was reopened, with more than a dozen commercial ships passing through the waterway, after a US-mediated 10-day ceasefire deal was reached between Israel and Lebanon.

The Islamic Revolutionary Guard Corps (IRGC) on Saturday said in a statement, cited by the Iranian media, that the ongoing US blockade of Iranian ports represented “acts of piracy and maritime theft”, adding that the control over Hormuz is “under the strict management and control of the armed forces”.

“Until the US restores full freedom of navigation for vessels travelling from Iran to their destinations and back, the status of the Strait of Hormuz will remain tightly controlled and in its previous condition,” it said.

By 10:30 GMT on Saturday, no fewer than eight oil and gas tankers had crossed the strait, but at least as many ships appeared to have turned back, having begun to exit the Gulf, the AFP news agency reported.

The toing and froing over the strait cast doubt on US President Donald Trump’s optimism the day before, that a peace deal to end the US-Israel war on Iran was “very close”.

Trump had celebrated the reopening of the strait on Friday, but warned the US attacks would resume until Iran agreed to a deal, which included its nuclear programme.

“Maybe I won’t extend it,” Trump told reporters on board Air Force One about the temporary ceasefire agreement in place. “So you’ll have a blockade, and unfortunately we’ll have to start dropping bombs again.”

Asked whether a potential deal could be made in this short timeframe, Trump said: “I think it’s going to happen.”

But Iran says no date has been agreed for another round of peace talks, accusing the US of “betraying” diplomacy in all negotiations.

The conflicting and changing reports about the strait and how much freedom ships have to transit through it have deterred many vessels from crossing, according to John-Paul Rodrigue, a maritime shipping specialist at Texas A&M University.

“Ships have been attempting transit since the announcement, but it looks like many of them are heading back because the situation is unclear,” Rodrigue told Al Jazeera. “There is contradictory information being issued by all parties.”

Reporting from Tehran, Al Jazeera’s Tohid Asadi said “uncertainty is the name of the game” as far as the Strait of Hormuz is concerned.

“Iran is looking for a comprehensive end to the war across the region, security assurances, sanctions relief, the unfreezing of frozen assets, regional relations – and on top of all of that – the nuclear dossier and Iran’s stockpile of highly enriched uranium,” he said.

“But right now, uncertainty is the name of the game. The fragile situation makes it hard to talk about the possibility of successful negotiations down the road.”

Michael Shoebridge, Director of Strategic Analysis Australia, says the US may be forced to end its blockade of Iran in order to see the full reopening of the Strait of Hormuz.

Field Marshal Asim Munir leaves Tehran while premier Shehbaz Sharif heads home from Turkiye amid hopes of another round of US-Iran talks.

Pakistan’s army chief and the prime minister have wrapped up separate diplomatic visits aimed at advancing efforts to end the United States-Iran conflict, with Field Marshal Asim Munir leaving Tehran and Prime Minister Shehbaz Sharif returning from Turkiye.

Munir met Iran’s leadership and peace negotiators during a three-day visit to Tehran, a Pakistani military statement said on Saturday.

The visit demonstrated Pakistan’s “unwavering resolve to facilitate a negotiated settlement… and to promote peace, stability and prosperity,” the military said ahead of expected US-Iran talks in Islamabad in the coming days.

Munir held talks with the country’s president, foreign minister, parliament speaker and head of Iran’s military central command centre.

Parliament Speaker, Mohammad Bagher Ghalibaf, and Foreign Minister, Abbas Araghchi, led the Iranian delegation to Islamabad for peace talks with the US last week, the highest level face-to-face contact between Washington and Tehran in decades.

Those talks ended without agreement, and a ceasefire is due to expire on April 22.

But diplomacy has continued, with Pakistan’s Prime Minister, Shehbaz Sharif, visiting Saudi Arabia, Qatar and Turkiye to push the peace process.

His three-country trip concluded on Saturday, with Sharif and Foreign Minister Ishaq Dar departing a diplomacy forum in Antalya, according to statements from both officials.

“I leave Antalya [Turkish city] with fond memories and a renewed commitment to further strengthening the enduring fraternal bonds between our two nations, and to continuing our close cooperation to advance dialogue and diplomacy for lasting peace and stability in the region,” Sharif posted on X.

The flurry of diplomacy comes as further negotiations are expected in Pakistan in the coming days as Islamabad intensifies contacts with regional and global leaders in an effort to sustain momentum towards a US-Iran deal.

Pressure for a deal between the two countries has grown after Iran reimposed restrictions on the Strait of Hormuz, hours after its reopening following the start of a ceasefire in Lebanon. Tehran accused the US of violating a deal to reopen the strategically important waterway.

Donald Trump has said a second round of talks with Iran could be held in Pakistan in the coming days. The New York Post reported that Trump praised Munir, saying he was “doing a great job”.

Reporting from Islamabad, Al Jazeera’s Kamal Hyder said Munir landed back home on Saturday as Pakistan prepared for another round of US-Iran talks expected “within the next few days”.

“We have also seen a lot of praise from the Trump administration on social media, praising the Pakistani leadership. So all eyes are on Islamabad. Serious differences remain, but there is a flurry of diplomatic activity and a hope and expectation that some sort of breakthrough may happen,” he said.

Brent crude falls more than 9 percent after Iran said it will reopen the strategic waterway, only to shut it down again over US blockade of its ports.

Oil prices have plummeted to their lowest point in weeks after Iran said the Strait of Hormuz was open for passage during a ceasefire in Lebanon, and United States President Donald Trump said he expected to ⁠reach a deal to end the war soon.

Brent crude, the international benchmark, fell more than 9 percent to $90.38 a barrel on Friday, taking it below $91 for the first time since March 10.

The plunge came after Iranian Foreign Minister Abbas Araghchi said the strait was “completely open” and would remain so for the duration of the 10-day ceasefire between Israel and Lebanon, which took effect on Friday.

Hailing Tehran’s announcement, Trump declared the waterway “ready for business and full passage,” but said the US Navy’s blockade of Iranian ports would remain in “full force” until the sides reached a peace deal.

On Saturday, however, Iran rowed back on its decision to reopen the Strait of Hormuz, warning that it would continue to block transit through the key waterway as long as the US blockade of Iranian ports remained in effect.

The announcement came after Trump said the blockade “will remain in full force” until Tehran reaches a deal with the US, including on its nuclear programme.

Roughly one-fifth of the world’s oil passes through Hormuz and further limits would squeeze already constrained supply, driving prices higher once again.

Amid the escalation, Pakistani officials say they are trying for more talks between the US and Iran ahead of the April 22 ceasefire deadline.

Meanwhile, ship tracking data displayed by MarineTraffic earlier on Saturday showed a significant uptick in vessels crossing the strait, which is located between Iran, the United Arab Emirates and Oman.

“It’s busy out there, the busiest I’ve seen it since the Strait of Hormuz was effectively closed at the beginning of the war,” Michelle Wiese Bockmann, an analyst at maritime intelligence firm Windward, said in a post on X.

“Last night there were few ships taking the risk but overnight there seems to have been a change.”

While Iran allowed a limited number of vetted ships to transit the waterway since the start of the war, traffic has remained at a trickle compared with pre-conflict levels.

The near-total closure of the strait has triggered one of the worst energy shocks in history, driving up fuel prices and prompting governments to roll out emergency measures.

Oil prices have swung wildly since the US and Israel launched strikes on Iran on February 28, hitting a post-conflict peak of $119 a barrel on March 19.

Iran’s Foreign Minister Abbas Araghchi and United States President Donald Trump have said that the Strait of Hormuz is open to commercial vessels.

Araghchi declared on Friday that the strategic waterwat was “completely open” in line with the ceasefire between Israel and Lebanon that took effect the previous day.

Trump affirmed on social media that the strait was open, later claiming that Iran had agreed to “never close the Strait of Hormuz again”. However, he also posted that the US naval blockade on Iranian ports would “remain in full force”.

In parallel, France and the United Kingdom hosted a meeting in Paris involving about 40 countries, which agreed to play a role in restoring freedom of navigation in the Strait of Hormuz once the US-Israeli war on Iran stops.

The blocking of tankers from using the strait, through which about 20 percent of the world’s crude flows on a typical day, has led to a global surge in fuel prices.

World leaders have welcomed the news with cautious optimism amid mixed messages from the US and Iran:

United States

“The Strait of Hormuz is completely open and ready for business and full passage, but the naval blockade will remain in full force and effect as it pertains to Iran, only, until such time as our transaction with Iran is 100% complete,” Trump wrote on Truth Social.

Minutes later, he issued another post saying the US Navy’s blockade on Iranian ships and ports “will remain in full force” until Tehran reaches a deal with the US, including on its nuclear programme.

Later, Trump told the news agency AFP that a deal to end the war on Iran was “close”, saying there were “no sticking points” left between Washington and Tehran.

Iran

Foreign Minister Abbas Araghchi posted on X that the strait was “declared completely open” and would remain open for the remaining period of the 10-day Israel-Lebanon ceasefire, which took effect overnight Thursday into Friday.

Some Iranian state media reports later appeared to contradict Araghchi’s announcement, with a senior military official telling state media that only nonmilitary vessels would be allowed to transit with permission from the Iranian Islamic Revolutionary Guard Corps (IRGC) Navy.

The Fars news agency, which is close to the IRGC, noted a “strange silence from the Supreme National Security Council”, the de facto top decision-making body in the country, as the status of the new supreme leader, Mojtaba Khamenei, remains unknown.

United Kingdom

UK Prime Minister Keir Starmer cohosted a summit on a potential military mission to secure the Hormuz Strait with French President Emmanuel Macron in Paris on Friday, with about 30 to 40 countries participating in person or by video conference.

On the sidelines, Starmer cautiously welcomed news of the strait’s reopening but said it must become “both lasting and a workable proposal”.

He said the UK and France would lead a “strictly peaceful and defensive” multinational mission to protect freedom of navigation as soon as conditions allow.

France

Speaking after the gathering, Macron said, “We all demand the full, immediate and unconditional reopening of the Strait of Hormuz by all parties.”

“We all oppose any restrictions or system of agreements that would, in effect, amount to an attempt to ⁠privatise the strait – and, of course, any toll system,” he added.

Macron’s office said roles for members of the international coalition working to reopen the strait could include “intelligence, mine-clearing capabilities, military escorts [and] communication procedures with coastal states”.

Germany

Chancellor Friedrich Merz said Germany could contribute mine clearance and intelligence capabilities to the international mission, but would need parliamentary support and a ″secure legal basis″ such as a UN Security Council resolution.

He said he wanted US involvement in the international mission to secure shipping through the Strait of Hormuz. “We believe this would be desirable,″ he said.

Trump later appeared to rebuff his overtures, saying on social media that he had received a call from NATO, but declined its assistance in no uncertain terms.

Finland

Finnish President Alexander Stubb, who participated in the Paris summit, said on X, “We welcome Iran’s announcement on opening the Strait. Lasting solutions require diplomacy,”

United Nations

United Nations Secretary-General Antonio ⁠Guterres on ⁠Friday welcomed the opening ‌of Strait of Hormuz by Iran ⁠and said ⁠it was “a ⁠step in the ⁠right ⁠direction”.

International Maritime Organisation

Arsenio Dominguez, secretary-general of the UN shipping agency said, “We are currently verifying the recent announcement related to the reopening of the Strait of Hormuz, in terms of its compliance with freedom of navigation for all merchant vessels and secure ‌passage.”

Shipping companies

The Norwegian Shipowners’ Association said several things had to be clarified before any ships can transit the strait, including the presence of mines, Iranian conditions and practical implementation.

“If this represents a step towards an opening, it is a welcome development,” said Knut Arild Hareide, CEO of the association, which represents 130 companies with some 1,500 vessels.

A spokesperson for Germany’s Hapag-Lloyd Shipping Company said, “We are now beginning to assess the new situation and the risks involved … For the time being, therefore, we are still refraining from passing through the strait.”

In a statement, Denmark’s Maersk said: “We have noted the announcement. The safety of our crew, vessels and customers’ cargo remains our priority. Since the outbreak of the conflict, we have followed the guidance of our security partners in the region, and the recommendation so far has been to avoid transiting the Strait of Hormuz.

“Any decision to transit the strait will be based on risk assessments and close monitoring of the security situation, with the latest developments also included in the ongoing assessments.”

Markets

Oil prices plunged after Iran’s announcement that passage for commercial vessels would remain “completely open” for the duration of a 10-day ceasefire in Lebanon.

“This news is having an immediate impact on markets,” said Kathleen Brooks, research director at XTB. “This is the biggest development so far during the ceasefire, and it gives hope that the war will end soon, and supply chains will return to some normality.”

Shipping companies said several things had to be clarified, including the presence of mines, Iranian conditions, practical implementations.

Shipping companies have cautiously welcomed Iran’s announcement that the Strait of Hormuz is open but said they would require clarifications, including about the risk of mines, before vessels move through the entry point to the Gulf.

Iran’s Foreign Minister Abbas Araghchi said on Friday that the Strait of Hormuz was open to all commercial vessels during a 10-day Lebanon ceasefire accord, prompting a fall in oil and other commodity prices while stock markets rose.

All commercial ships, including United States vessels, can sail through the strait, although their plans need to be coordinated with Iran’s Islamic Revolutionary Guard Corps, a senior Iranian official told the Reuters news agency.

Transit would be restricted to lanes which Iran deemed safe, adding that military vessels were still prohibited, the official said.

“We are currently verifying the recent announcement related to the reopening of the Strait of Hormuz, in terms of its compliance with freedom of navigation for all merchant vessels and secure passage,” said Arsenio Dominguez, secretary-general of the United Nations shipping agency, the International Maritime Organization.

The Norwegian Shipowners’ Association said several things had to be clarified before any ships could transit the strait, including the presence of mines, Iranian conditions and practical implementation.

“If this represents a step towards an opening, it is a welcome development,” said Knut Arild Hareide, CEO of the association which represents 130 companies with some 1,500 vessels.

Shipping association BIMCO cautioned members on returning to the strait.

“The status of mine threats… is unclear and BIMCO believes shipping companies should consider avoiding the area,” said Jakob Larsen, BIMCO’s chief safety and security officer.

The threat posed by mines in parts of the strait is not fully understood, and avoidance of the area by ships should be considered, a US Navy advisory on Friday, seen by Reuters, also said.

German shipping group Hapag-Lloyd on Friday said it was working for its ships to sail through the strait “as soon as possible”, but added that several questions remained.

“Our crisis committee is in session and will try to resolve all open items with the relevant parties within the next 24-36 hours,” it added.

Its Danish peer Maersk said it was closely monitoring the security situation and would act based on its risk assessment.

France’s CMA CGM and Norwegian oil tanker group Frontline declined to comment.

A recent route imposed by Tehran through its territorial waters near Larak Island would present navigational challenges even if vessels were not required to pay a toll, and would raise questions regarding compliance and insurance, said Matt Wright, lead freight analyst at data intelligence firm Kpler.

US President Donald Trump on Friday said Iran had agreed to never close the strait again, and that it was removing sea mines from it.

One of the world’s most important maritime chokepoints, disruption in the strait has forced shipping companies to suspend sailings, reroute cargo and rely on costly workarounds to keep goods moving in and out of the Gulf.

Iran says ‘passage for all commercial vessels through Strait of Hormuz’ open during the Israel-Lebanon ceasefire.

The Strait of Hormuz is “completely open” for all commercial vessels and will remain so during the Israel-Lebanon ceasefire, Iran’s foreign minister has said.

“In line with the ceasefire in Lebanon, the passage for all commercial vessels through Strait of Hormuz is declared completely open for the remaining period of ceasefire,” Abbas Araghchi said in a post on X on Friday.

A 10-day ceasefire was agreed between Israel and Lebanon late on Thursday.

The passage of ⁠vessels through the ⁠strait will be on the coordinated route as ⁠already announced by ⁠Ports and ⁠Maritime Organisation of Iran, Araghchi added.

United States President Donald Trump confirmed in a social media post that the strait was “completely open and ready for business and full passage”.

More to come…

Al Jazeera’s Tohid Asadi discusses the prospect that the ceasefire between Israel and Hezbollah in Lebanon could lead to a comprehensive deal between the US and Iran to end regional hostilities.

The International Monetary Fund has downgraded its global growth forecast for 2026 from 3.3 to 3.1 percent, citing the impact of the United States-Israeli war on Iran and the shutdown of the Strait of Hormuz on the world economy.

The war has damaged energy infrastructure across the Gulf, while critical exports like oil, gas, chemicals and fertiliser remain largely stranded by Iran’s shutdown of the strait and the subsequent US naval blockade of Iranian ports.

In the worst-case scenario of a prolonged war, the IMF said global growth could fall to 2.5 percent in 2026, with low-income and developing economies hit the hardest by soaring commodity and energy prices. The global shipping and logistics industry is facing a separate crisis.

But every economic crisis also has beneficiaries: despite the dire macroeconomic outlook, some corners of the global economy are thriving on the uncertainty.

Here’s a look at five industries that are doing well either despite – or because of – the darkening economic outlook.

Wall Street investment banks

Global investors have been on a rollercoaster since the start of US President Donald Trump’s second term last year. The president’s erratic decision-making, where he often issues an ultimatum one day and then changes it the next, has led traders to coin the term “TACO trade”, where TACO stands for “Trump Always Chickens Out”.

The recent volatility has made some investors anxious, but it’s been a boon to investment banks, which make millions in commissions and revenue from the surging volume of trade, according to Sean Dunlap, a director of equity research at Morningstar Research Services.

“Clients want to reposition, so they trade frequently,” he told Al Jazeera. “Spreads tend to increase, which increases the profitability for trade intermediaries like banks.”

First-quarter results for 2026 – released this week – showed that Morgan Stanley reported a profit of $5.57bn, up 29 percent year on year, while Goldman Sachs reported a profit of $5.63bn, up 19 percent year on year.

JP Morgan Chase also reported major gains, with first-quarter earnings of $16.49bn, up 13 percent year on year. The banks all cited high levels of trading, deal-making, and “robust client engagement” as the reasons behind surging profits.

The boomtime for banks could reverse course, however, if volatility persists for too long, Dunlap warned, because investors may become increasingly cautious and less willing to borrow money to make trades.

Prediction markets

As mainstream Wall Street banks reap profits, the crypto-based prediction platform Polymarket has been earning upwards of $1m a day since the start of the month by letting users make peer-to-peer bets on everything from sports tournaments to elections.

Polymarket has been doing well since the start of the war, but it revised its fee structure on March 30 to cash in even more on its popularity.

Rival platforms like Kalshi, Novig and Robinhood also follow the same business model, but Polymarket has been the standout winner of 2026 because it controversially allows users to bet on the outcome of conflicts like the Iran war.

Polymarket revised its fee structure on March 30 to cash in on its popularity. The change has already netted the platform more than $21m in fees since April 1, up from $11.6m for all of March and $6.23m for all of February, according to DefiLlama, a website that provides data analysis for decentralised finance platforms.

If the current trend continues, Polymarket could make $342m in fees this year alone, according to DefiLlama’s analysis.

Anonymous users have also made millions correctly predicting the dates of major events like the US-Iran ceasefire, but the outcomes for rank-and-file users are typically less impressive.

Researchers found that the top 1 percent of Polymarket users captured 84 percent of all trading gains, according to a new report released this month analysing 70 million trades from 2022 to 2025. The returns are so high that US federal regulators have pledged to crack down on insider trading in prediction markets following suspiciously well-timed bets on Iran war outcomes.

Aerospace and defence

Unsurprisingly, the aerospace and defence industries are booming this year due to major conflicts in Ukraine, Iran, Sudan, Gaza and Lebanon and a surge in global defence spending.

About half of the world’s countries have increased their military budgets over the past five years, according to an April report from the IMF, which means they are also buying everything from drones to missiles — more than ever before. Demand is growing particularly fast in Europe, where NATO countries have committed to raising defence spending to 5 percent of gross domestic product (GDP) by 2035.

The defence industry has, in turn, seen major gains on the stock market. The MSCI World Aerospace and Defence Index – which tracks aerospace and defence stocks across 23 global markets – reported net returns of 32 percent year on year at the end of March.

The defence index outpaced the MSCI World Index, which tracks 1,300 large and mid-cap companies across the same 23 markets. The index, which gives a broader overview of global stock markets, reported net returns of 18.9 percent over the same period.

Artificial intelligence

Last year, the United Nations Trade and Development (UNCTAD) office predicted that the AI industry would grow from $189bn in 2023 to $4.8 trillion by 2033, and the Iran war does not seem to have dented the outlook.

“Despite the shocks from the Iran war, we’re still seeing resilience in a lot of sectors like artificial intelligence and renewable energy,” said Nick Marro, lead analyst for global trade at the Economist Intelligence Unit.

One metric for the AI boom has been the high volume of semiconductor chips still being exported out of East Asia, he said. At the top of the chart is chipmaking powerhouse Taiwan, which reported record-breaking merchandise exports of $80.2bn in March, up 61.8 percent year on year, according to EIU analysis.

The surge was led by exports to the US, which grew by 124 percent year on year, the EIU said.

Taiwan Semiconductor Manufacturing Company, the world’s top chipmaker better known by its acronym “TSMC,” on Thursday posted a net income of 572.8 billion New Taiwan Dollars (NTD) ($18.1bn) for the first three months of 2026 – up 58 percent year on year in NTD.

Another metric, initial public offerings or “IPOs,” also shows that the industry is confident for the moment, with industry leaders Anthropic and OpenAI both planning to go public this year.

Renewable energy

The Iran war has highlighted the need to transition from fossil fuels not only for environmental reasons, but also for reasons of energy security. The war marks the third major energy shock this decade, following the COVID-19 pandemic and the 2022 Russian invasion of Ukraine.

The Iran war has “boosted” renewable energy “given the urgency to switch away from fossil fuels and diversify towards renewable sources,” Marro of the EIU said.

Even before the Iran war began, the International Energy Agency reported that global governments were already taking active measures to invest in renewable energy for geopolitical reasons.

According to an IEA report released this month, “150 countries have active policies to advance renewable and nuclear deployment, 130 have energy efficiency and electrification policies, and 32 have policies to incentivise supply chain resilience and diversification across critical minerals and clean energy technologies.”

The Iran war has triggered another flurry of policymaking in Asia, which typically buys 80 to 90 percent of the oil and gas that transits through the Strait of Hormuz. Since the shutdown, the region has been struggling to find alternative sources of energy, forcing governments to deploy emergency measures like fuel rationing and price caps.

South Korea, Thailand, India, Cambodia, Indonesia, Vietnam and the Philippines have all announced a variety of measures from tax breaks for at-home solar panels to commissioning new renewable energy projects – and even restarting nuclear reactors.

The surge in policymaking has been good for the renewable industry. The S&P Global Clean Energy Transition Index, which tracks 100 companies that produce solar, wind, hydro, biomass and other renewable energy across emerging and developed markets, is up 70.92 percent year on year.

Islamabad, Pakistan – Pakistan’s Foreign Ministry on Thursday confirmed that the United States and Iran were in discussions – through Islamabad – to hold a second meeting between their negotiators to end their now nearly seven-week war, with a fragile ceasefire announced on April 8 days away from expiring.

But it added that no date had been set for that next round of negotiations, even as Islamabad stepped up a parallel diplomatic push to keep the process alive.

“Who will come, how big the delegation will be, who will stay, and who will go is for the parties to decide,” Foreign Ministry spokesperson Tahir Andrabi told reporters in Islamabad, referring to what upcoming talks might look like. “As a mediator, it’s important for us to keep the talks confidential. We had the details and information of the talks entrusted to us by the negotiating parties.” 

Speaking of the first round of talks on April 12 in Islamabad, which concluded without a deal, Andrabi said: “There was neither a breakthrough nor a breakdown.”

The spokesperson confirmed that nuclear issues remained among the key subjects under discussion, but declined to elaborate.

His comments came as Pakistan’s civil and military leadership is travelling across the region in what some observers have begun calling the “Islamabad Process”, reflecting the government’s attempt to frame negotiations as an ongoing diplomatic effort rather than a one-off engagement.

Parallel diplomatic tracks

Pakistan’s Prime Minister Shehbaz Sharif arrived in Doha on Thursday, the second stop of a four-day regional tour that began with Jeddah on Wednesday, and will see him visiting Antalya next.

Meanwhile, Pakistan’s Chief of Defence Forces (CDF) Asim Munir arrived in Tehran on Wednesday with a delegation that included Interior Minister Mohsin Naqvi.

Munir was received at the airport with a warm hug from Iranian Foreign Minister Abbas Araghchi, who said he was “delighted” to welcome the field marshal and expressed gratitude for Pakistan’s “gracious hosting of dialogue”.

On Thursday, Iranian Parliamentary Speaker Mohammad Bagher Ghalibaf, who led Tehran’s delegation at the Islamabad talks, also met Munir.

Reza Amiri Moghadam, Iran’s ambassador to Pakistan, said at an event in Islamabad that Tehran would not consider any venue other than Pakistan for talks with Washington.

“We will do talks in Pakistan and nowhere else, because we trust Pakistan,” he said.

Muhammad Faisal, a Pakistani security analyst and scholar at the University of Technology Sydney, said the parallel outreach reflected a deliberate division of labour.

“Pakistan’s strategy appears to be dual-tracked: PM Sharif is reassuring Gulf allies and attempting to build a broader support coalition, while CDF Munir is engaged in hard negotiations between the two sides to narrow gaps between Iran and the US, with an eye on extending the ceasefire and reaching a broader understanding,” he told Al Jazeera.

Reports that Munir might travel to Washington, DC after Tehran were denied by security officials, who called them “speculative”. Andrabi said he was not aware of any such development.

In Jeddah on Wednesday, Sharif met Saudi Crown Prince Mohammed bin Salman and expressed “full solidarity and support” for the kingdom following regional escalation, according to Pakistan’s Foreign Ministry. The crown prince praised what Riyadh described as the “constructive role” played by both Sharif and Munir.

In Doha, Sharif met Qatar’s Emir Sheikh Tamim bin Hamad Al Thani and discussed “the regional situation, particularly in the Gulf region”, underscoring “the importance of de-escalation, dialogue and close international coordination to ensure peace and stability”, the prime minister’s office said.

From Doha, Sharif heads to Antalya with Deputy Prime Minister and Foreign Minister Ishaq Dar. They are expected to meet counterparts from Saudi Arabia, Turkiye and potentially Egypt on the sidelines of the Antalya Diplomacy Forum on April 17.

Regional security push

The Antalya meeting is part of a broader diplomatic effort. Turkiye is preparing to host talks on a regional security platform involving Pakistan, Saudi Arabia and possibly Egypt, according to officials familiar with the discussions.

It would be the third such meeting in a month, following earlier rounds of talks in Riyadh and Islamabad.

The goal is to establish a platform for regular, structured cooperation on regional security issues, the officials said, stressing the discussions are distinct from current efforts to end the Iran war.

Turkish Foreign Minister Hakan Fidan confirmed that discussions were under way, but said no agreement had been finalised.

“This pact is necessary so that countries can be assured of one another,” he told the state-run Anadolu Agency on Monday.

Turkiye also reaffirmed support for the US-Iran peace process on Thursday.

“We will continue to provide the necessary support for the ongoing ceasefire to turn into a permanent truce and eventually lasting peace, without becoming more complex and difficult to manage,” the Defence Ministry said, adding that it expected “the parties will be constructive in the ongoing negotiation process”.

Pakistan’s Foreign Ministry said senior officials from the four countries had also met in Islamabad earlier this week to prepare recommendations for Antalya.

Ceasefire under strain

The two-week ceasefire brokered by Pakistan on April 8, which halted attacks in Iran and the Gulf, is due to expire on April 22. While still holding, it is under increasing strain.

A US naval blockade on Iranian ports remains in place, with the US Central Command saying its forces had turned away nine ships as of Wednesday.

Kamran Yousuf, an Islamabad-based journalist and expert on diplomatic affairs, said he expected the ceasefire to be extended.

“I would be really surprised if the current ceasefire is not extended. There is little appetite on both sides to go back to war. There are enough signs on the ground that if there is no deal before the truce expires, the ceasefire will be extended,” he told Al Jazeera.

Faisal offered a more cautious assessment, warning that failure to secure a second round would shift Pakistan’s role.

“Pakistan’s mediation will not collapse immediately, but Islamabad’s role will change from mediator to crisis manager. If hostilities resume, Pakistan will focus again on brokering a ceasefire,” he said.

Despite uncertainty, signals from both Washington and Tehran have remained cautiously optimistic.

White House press secretary Karoline Leavitt said further talks would “very likely” take place in Islamabad, adding, “We feel good about the prospects of a deal.”

Iran’s Foreign Ministry spokesperson Esmaeil Baghaei said multiple messages had been exchanged with Washington through Pakistan since April 12.

US President Donald Trump said on Tuesday that talks could resume within two days and that Washington was “more inclined to go” to Pakistan.

Sticking points remain

The path to a second round remains complicated by unresolved disputes.

Iran has insisted that Lebanon be included in any agreement, arguing that ongoing Israeli strikes there, which have killed more than 2,000 people and displaced 1.2 million, cannot be separated from the wider conflict.

On April 14, the United States convened a trilateral meeting in Washington with the ambassadors of Israel and Lebanon, the first direct engagement between the two sides since 1993.

US Secretary of State Marco Rubio mediated the talks, which both sides described as “productive”, but no ceasefire or follow-up meeting was agreed.

Washington has maintained that any Lebanon deal must remain separate from US-Iran negotiations, rejecting Tehran’s position. On Thursday, Israel said its Prime Minister Benjamin Netanyahu would speak on the phone with Lebanese President Joseph Aoun — but Beirut had not confirmed any plans for a telephone conversation. The two countries do not have formal diplomatic relations.

At Thursday’s briefing, Andrabi aligned Pakistan with Iran on this issue.

“Peace in Lebanon is essential for US-Iran peace talks,” he said, adding that “signs of improvement on the Israel-Lebanon front over the past two days are encouraging.”

Yousuf said a Lebanon ceasefire would send an important signal to Iran.

“Extending the ceasefire to Lebanon will be an important confidence-building measure, a signal from the US that it is serious about a second round. It will also give Tehran good reason to return to the table,” he said.

But he added that the deeper challenge remained Iran’s nuclear programme.

“The nuclear issue is at the heart of the real problem. The flurry of shuttle diplomacy initiated by Pakistan is aimed at bridging the gap between the two sides,” he said.

Grace Wermenbol, a former US national security official and senior visiting fellow at the German Marshall Fund, said Washington’s approach to Lebanon would hinge on Trump’s willingness to pressure Israel.

“A clear pathway to a cessation of hostilities in Lebanon exists,” she told Al Jazeera. “The question is whether Trump will be willing to apply the pressure necessary on Israel to halt its military offensive and allow the Lebanese government to continue its military disarmament efforts. So far, and this is also true for the months preceding the latest escalation between Israel and Hezbollah, we have not seen this pressure materialise.”

The Strait of Hormuz remains another major obstacle.

The waterway, through which roughly a fifth of the world’s oil passes during peacetime, has effectively been blocked by Iran since early in the war, except for ships belonging to countries that have struck individual deals with Tehran.

Starting Monday, the US imposed its own naval blockade on the strait, to prevent any Iran-linked vessel from passing through.

“Iran’s effective closure of the Strait of Hormuz has emerged as the primary issue in US-Iranian negotiations. Opening it is crucial to easing upward pressure on oil prices and instilling confidence in global markets,” Wermenbol said.

She added that Tehran appeared to be betting Washington would eventually back down.

“There is no easy military option here,” she said. “The only way to resolve this issue and remove the threat to maritime traffic will need to involve a diplomatic deal.”

United States Pentagon Chief Pete Hegseth has said the military blockade of Iran’s ports will continue “as long as it takes”, saying Washington remained “locked and loaded” to attack Iran’s energy facilities.

The US Pentagon chief spoke on Thursday as a tenuous pause in fighting agreed to last week has continued. On Monday, President Donald Trump announced the military would blockade Iran’s ports in the Strait of Hormuz and the Persian Gulf after US-Iran talks in Pakistan failed to reach a breakthrough.

Hegseth struck an aggressive tone as he maintained the US military was monitoring Iran’s military movements during the pause in fighting, which currently is meant to extend through early next week.

“We are reloading with more power than ever before…even more importantly, better intelligence than ever before,” Hegseth said.

“As you expose yourself with your movement to our watchful eye, we are locked and loaded on your critical dual-use infrastructure, on your remaining power generation and on your energy industry,” he said.

Still, the Pentagon chief said the US prefers to resolve the conflict, which began with US-Israeli attacks on Iran on February 28, through diplomacy.

“You, Iran, can choose a prosperous future, a golden bridge, and we hope that you do for the people of Iran,” he said. “In the meantime and for as long as it takes, we will maintain this blockade, successful blockade, but if Iran chooses poorly, then they will have a blockade and bombs dropping on infrastructure, power and energy.”

On Wednesday, a Pakistani delegation arrived in Tehran to coordinate a new round of talks. While both sides have indicated they remained open to further negotiations, Major-General Ali Abdollahi, the commander of the Khatam al-Anbiya Central Headquarters of the Islamic Revolutionary Guard Corps (IRGC), warned that the US blockade could end the current pause in fighting.

White House spokesperson Karoline Leavitt, meanwhile, indicated the US maintained a positive outlook on future talks.

“At this moment, we remain very much engaged in these negotiations, in these talks,” she said.

But reporting from Tehran on Thursday, Al Jazeera’s Ali Hashem says deep-seated distrust remains. The US under Trump twice attacked Iran amid ongoing indirect talks over Iran’s nuclear programme, a fact that has cast a long shadow over the most recent bout of diplomacy.

“Clearly, there have been several messages conveyed to the Iranians. But rather than consolidating a feeling of trust and optimism, it seems that it’s already shaken,” he said.

“We saw a platform closely associated with the foreign ministry tweeting today, quoting a source saying that whatever is being demonstrated or said in the media regarding the optimism is just hype, and this is used for PR and it’s for President Trump to use in the markets,” he said.

Iran’s speaker of parliament, Mohammad Bagher Ghalibaf, who led the Iranian delegation in the talks with Iran, told his Lebanese counterpart on Thursday that a ceasefire in Israel’s invasion and ongoing bombardment of Lebanon is “as important” as the pause in fighting in Iran.

A Lebanon ceasefire has emerged as one of the main sticking points in talks, which also include control of the Strait of Hormuz and the future of Iran’s nuclear programme.

‘We will use force’

Speaking during the news conference on Thursday, General Dan Caine, the chairman of the Joint Chiefs of Staff, said so far, 13 ships leaving Iranian ports have turned around in response to US military warnings.

“If you do not comply with this blockade, we will use force,” Caine said.

Admiral Brad Cooper, the head of US Central Command (CENTCOM), meanwhile, said the US is using the wear to rearm and reposition its forces.

“We’re rearming, we’re retooling, and we’re adjusting our tactics, techniques and procedures. There’s no military in the world that adjusts like we do, and that’s exactly what we’re doing right now during the ceasefire,” said.

During questions with reporters, Hegseth also shot down reports that China was planning to send weapons to Iran amid the pause in fighting. Hegseth said Washington had received assurances from Beijing that this was not the case.

Hegseth also used a large portion of the news conference to attack US press coverage of the war, which the Trump administration is receiving criticism for its shifting objectives and justifications for launching the conflict.

Hegseth called the coverage “incredibly unpatriotic”.

The developments following the 12-day war between Iran and Israel did not lead to de-escalation, but rather to a redefinition of the conflict on a much broader scale. While volatile negotiations between Tehran and Washington continued, the gap between the two sides’ expectations deepened. Ultimately, this gap led to a decision at the White House based on an optimistic assessment: To enter a limited conflict and force Iran into a rapid retreat.

But the battlefield quickly shattered that assumption. The war that was meant to be short, controlled, and manageable turned into a 40-day war of attrition, one that not only failed to achieve the initial objectives of the United States but imposed heavy military, economic, and political costs.

The key question is: What caused this deep disconnect between initial assessments and reality? To answer that question, this article focuses on pre-war miscalculations and decisive variables during the conflict.

1- Incorrect generalisation of the 12-day war experience

Washington assumed Iran’s behavioural pattern from the short war with Israel would repeat, but this time the level of direct US involvement was far higher. Iran adjusted its response accordingly, most notably by playing the Strait of Hormuz card. According to published reports from a US situation room meeting on February 12, General Keane, chairman of the Joint Chiefs of Staff, warned of the risks of closing the strait, but Trump rejected the general’s assessment and assumed Iran would surrender before reaching that point. On the ground, however, the Strait of Hormuz became a decisive factor in disrupting both economic and military calculations.

2- Neglecting Iran’s strategic shift

The US still assumed Iran’s main target would be Israel, but this time Tehran focused on US bases across the region. The UAE, Bahrain, Kuwait, Qatar, Saudi Arabia and Jordan were placed directly on Iran’s target list.

3- Miscalculating Iran’s military and defensive capabilities

Iran’s gradual advances in missile technology, operational precision and air defence systems were not sufficiently accounted for in Washington’s calculations. The US did not believe Iran’s air defences could down its fighter jets or that Iranian missiles could disable the advanced radars at Gulf Arab states’ bases. Battlefield developments revealed a real leap in Iran’s offensive and defensive capabilities, imposing high costs on the US Air Force and seriously challenging its air superiority.

4- Wrong predictions about Iran’s domestic situation

One of Washington’s key assumptions was the outbreak of instability or internal collapse. Intelligence reports from December led them astray, convincing Trump that with widespread assassinations and the activation of public protests, Iran lacked the necessary resilience. In practice, however, a state of war led to social cohesion and strengthened the spirit of resistance. The reason lies in the “civilisational variable”, the role of historical identity and behavioural patterns within Iranian society, which, in times of crisis, through modern activism and mass street presence, shape national resistance. Washington mistook a “battle for national survival” for “political protests”.

5- Underestimating the cohesion of the “axis of resistance”

The US expected Iran-aligned groups to play a marginal role, but their operational coordination drastically increased battlefield complexity. The “axis of resistance” lined up in a unified front against the US, while NATO failed to provide effective support for Washington, revealing fractures in Washington’s traditional alliances when faced with costly crises.

6- Growing domestic and international pressure

The continuation of the war was met with opposition inside the US – from media criticism by former Trump supporters and figures like Tucker Carlson to human rights protests over attacks on civilians, particularly the Minab school tragedy, which quickly eroded the moral legitimacy of the operation in global public opinion, including within the US.

Meanwhile, the expansion of the war into the region caused oil prices to surge past $120, raising serious concerns and analyses about $200 oil, placing heavy economic pressure on US households.

On the international stage, the veto of Bahrain’s proposed resolution by Russia and China, along with the independent stances of some Western allies, dramatically increased the political cost of the war for Washington.

7 – Signs of fractures within US military decision-making structures

Command disagreements grew increasingly severe. The widespread dismissal of senior generals – including the army chief of staff and several other commanders – in the middle of the war was like a major earthquake at the Pentagon. This was no simple administrative reshuffle; it reflected a deadlock in modern military doctrine, which negatively impacted operational continuity.

Taken together, these errors – from misreading Iran’s behaviour and strategic evolution to ignoring simultaneous domestic and international pressures – placed the US in a position where accepting Iran’s terms after 40 days to begin negotiations became the only realistic option.

In the end, this war stands as a clear example of strategic deadlock: Where the gap between optimistic initial estimates and battlefield realities fundamentally alters the course of events.

It is an experience that will likely be discussed and revisited for years to come in Washington’s strategic circles.

The views expressed in this article are the author’s own and do not necessarily reflect Al Jazeera’s editorial stance.

The US has spent decades trying to squeeze Iran economically.
Six weeks into the Middle East conflict, Tehran is still standing.
US and Israeli attacks on infrastructure, industry and trade have damaged Iran’s sanctioned economy even further.

But oil revenues have kept flowing, giving the regime a financial cushion.

The Strait of Hormuz is now at the centre of this economic battle; whoever controls it controls the pressure.

At the negotiating table, sanctions relief, billions in frozen assets and war reparations are all at stake.

Meanwhile, millions of Iranians are bearing the brunt of inflation, shortages and a collapsing currency.

A major fire at a key refinery in Australia refinery has disrupted fuel production, raising fears of shortages as supplies are already strained by the Iran war.

US–Iran talks gain pace as Pakistan mediates, with fresh optimism for a new round of talks in Islamabad.

Efforts to revive US-Iran negotiations are gathering pace, with Pakistan again having an important mediating role as its leaders hold high-level talks in Tehran and the Gulf.

Amid a renewed push to end the war, a Pakistani delegation, led by army chief Field Marshal Asim Munir is in Tehran. He is expected to relay messages from the United States, while Pakistan’s Prime Minister, Shehbaz Sharif, arrived in Saudi Arabia as part of a regional tour that includes Qatar and Turkiye.

Iran’s Foreign Ministry spokesman, Esmael Baghaei, said Tehran and Washington have remained in contact since talks in Islamabad ended on Sunday. On Wednesday, Washington signalled optimism about a new round of talks in the Pakistani capital.

But the diplomatic push comes amid increasing tension, as Iran warns it could expand its response to the US naval blockade beyond its own waters.

Divisions in Washington persist, with the US Senate rejecting a measure to limit the war without congressional approval.

Here is what we know:

In Iran

• Hormuz tensions remain high: Adviser Mohsen Rezaei warned that Iran could target US ships, if Washington continues to enforce its naval blockade in the Strait of Hormuz. The warning comes as the US tightens restrictions on vessels linked to Iranian ports, with ships already being turned back amid the standoff.
• Nuclear issue shows potential breakthrough: Analyst Abas Aslani says Tehran is open to nuclear transparency if Washington is serious about a deal, but new US sanctions and the blockade of Iranian ports are fuelling distrust.
• “There is a sense of distrust, and at the moment, Iran is ready for every possible scenario, either progress in the negotiations or returning to the military conflict,” he told Al Jazeera.
• Iran’s Foreign Minister Abbas Araghchi warned of consequences over US “provocative actions” in the Gulf and the Strait of Hormuz during a call with his Chinese counterpart Wang Yi.

War diplomacy

• Round two of talks: The US is discussing holding a second round of peace talks with Iran and is optimistic about reaching a deal, the White House said.
• China supports ‘momentum’ of peace talks: China’s Foreign Minister, Wang Yi, told his Iranian counterpart that Beijing “supports maintaining the momentum of the ceasefire and peace talks”.
• Saudi crown prince, Pakistan PM meet: Crown Prince Mohammed bin Salman and Shehbaz Sharif met in Jeddah to discuss regional issues, including US-Iran negotiations. Talks hosted by Pakistan were a key focus, said the Saudi Press Agency.
• US and Qatar: US President Trump discussed regional developments and energy concerns, specifically regarding the oil market and gas prices, with Qatari Emir Sheikh Tamim bin Hamad Al Thani.

In the US

• US President Donald Trump has announced that Israeli and Lebanese leaders will hold direct talks later today – their first such contact in 34 years.
• New oil sanctions: US officials targeted more than two dozen individuals, along with companies and vessels linked to the oil transport network of Iranian shipping magnate Mohammad Hossein Shamkhani.
• US says 10 vessels blocked from Iranian ports: The US military’s Middle East command (CENTCOM) said 10 ships were stopped or redirected within the first 48 hours of a naval blockade, with none leaving Iranian ports.
• US Congress divisions: The Senate rejected efforts to limit US involvement in the war and blocked measures targeting arms sales to Israel, though growing opposition signals shifting political pressure.

In Israel

• ‘Identical’ goals: Israeli Prime Minister Benjamin Netanyahu said that Israel and the US are fully aligned in their objectives to contain Iran.
• Ceasefire pressure, no halt in fighting: Despite pressure, Netanyahu said Israel would continue military operations.
• End of Hezbollah: The Israeli prime minister said the country’s top priority in Lebanon was to secure the “dismantling” of Hezbollah, in its first direct talks with the country in decades.
• “There are two central objectives: first, the dismantling of Hezbollah; second, a sustainable peace… achieved through strength,” he said.

In Lebanon

• Relentless strikes continue: Air raids and shelling hit southern and eastern Lebanon, including Kafr Sir and Nabatieh, while a “triple-tap” strike in Mayfadoun killed four paramedics. Israeli vehicles and bulldozers remain active.
• Lebanon’s Minister for Administrative Reform Fadi Makki said an Israeli attack that killed four paramedics in southern Lebanon was “a new war crime”.
• Rising toll: Israeli strikes have killed at least 2,167 and injured more than 7,000 people, according to the Lebanese Health Ministry. About 1.2 million people have been displaced since March 2. Israel has been accused of destroying homes in southern Lebanon, as happened in Gaza.
• ‘Homes that no longer exist’: “Even if a ceasefire is reached, the reality on the ground is devastating.. entire communities along the border have been destroyed,” Al Jazeera’s Malcolm Webb reported from Beirut. He added that Israel has yet to secure its objective of controlling territory up to the Litani River.
• Balakrishnan Rajagopal, the UN special rapporteur on the right to housing, has joined other UN human rights experts, calling for Israel to immediately stop its bombing of Lebanon. Rajagopal wrote on social media that the Israeli military is using the “same strategy” in southern Lebanon as in Gaza or the occupied West Bank.
• Diplomatic tensions grow: Hezbollah has condemned US-hosted Israel-Lebanon talks as “shameful,” while a failed Senate vote to block bulldozer sales to Israel highlights increasing concern over civilian harm.

Global economy

• Growing hunger fears: The war could push millions more towards hunger as its economic fallout reverberates around the globe, the World Bank’s chief economist told AFP.
• “You have about 300 million people who suffer from acute food insecurity already,” Indermit Gill said.  “That’ll go up by about 20 percent very, very quickly,” as knock-on effects grow.
• Wall Street records: Major Wall Street stock indices finished at record highs on Wednesday following optimism about an accord in the US-Iran conflict.

Srinagar, Indian-administered Kashmir — The gold earrings were a gift from her father on her birthday just months earlier. But on March 21, as South Asia marked Eid‑ul‑Fitr, Masrat Mukhtar handed them over to an aid collection effort to help civilians in Iran trying to survive the US-Israel war on the country.

She was one of many in Indian-administered Kashmir who paused their customary rituals and celebrations on the auspicious day to contribute cash, household items, and personal assets for a people more than 1,000 miles away.

Her cousins followed, each bringing items of personal value. Families offered copper utensils, livestock, bicycles, and portions of savings. Children broke their piggy banks, sharing savings they had carefully collected over several years. Shopkeepers and traders handed over parts of their earnings.

“We give what we love. This brings us closer to them,” said Mukhtar, a 55-year-old woman from Budgam in the central part of Indian-administered Kashmir, before referring to a name by which the region has historically also been known. “This is what Little Iran does for its namesake. The bond persists through time and conflict.”

That bond, rooted in more than six centuries of historical connections, has taken on a much more overt presence during the war – drawing recognition from Iranian authorities, and concerns over some fund collection methods from Indian officials.

One daughter’s wealth, to another daughter

In Zadibal, a Shia-majority area of Srinagar – the biggest city in Indian-administered Kashmir – 73-year-old Tahera Jan watched neighbours contribute copper pots.

“Kashmiris traditionally collect these utensils for their daughters’ weddings. We chose to give them instead to daughters who lost mothers and sisters in the attacks,” Jan said.

Sadakat Ali Mir, a 24-year-old mini-truck driver, contributed one of the two vehicles he drives for his livelihood. Other contributors offered bicycles, scooters, and other essential items. Children, including nine-year-old Zainab Jan, handed over piggy banks.

To be sure, that Shia constitute between 10 to 15 percent of Indian-administered Kashmir’s population is a factor in why the war in Iran resonates so deeply in the region. But donations for Iran have extended well beyond Shia. Several Sunni families observed simpler Eid meals, redirecting household resources towards Iranian relief. Some shopkeepers closed early, while families adjusted daily routines to contribute.

Political and religious figures also participated. Budgam lawmaker Aga Syed Muntazir Mehdi donated a month’s salary to the relief effort. Imran Reza Ansari, a Shia scholar and leader of the People’s Conference party, noted public participation across communities.

Similar donation campaigns in support of Iranians have also been reported from Pakistan, Iraq and other countries.

But at the heart of this outpouring of support for Iran in Indian-administered Kashmir – which also witnessed large rallies after the killing of Iranian Supreme Leader Ayatollah Ali Khamenei on February 28 – are rare cultural ties that Kashmir and what was then Persia have shared for centuries.

‘Little Iran’

Sufi scholar Mir Sayyid Ali Hamadani arrived in Kashmir from Hamadan in Iran in the 14th century, introducing religious practices, art forms, and Persian literary traditions. Persian architectural influences appear in historical mosques, and the Persian language has shaped local literature.

Irshad Ahmad, a scholar of Central Asian studies, said donation drives drew on this historical reservoir, with prayers, rituals, and art forms reflecting longstanding ties. Kashmir has historically been referred to as Iran-e-Sagheer, or Little Iran.

The donations carry personal and cultural meaning beyond financial value, said experts. “People are not only parting with objects; they are sharing emotional continuity,” Sakina Hassan, a lecturer on humanitarian practices in New Delhi, said.

More than 2,000 people have been killed in Iran during the war, which is on pause at the moment amid a fragile ceasefire brokered by Pakistan. The first round of direct talks between the United States and Iran in Islamabad last week broke down without a deal, and mediators are working on pushing the two sides towards new talks. The ceasefire is set to expire next Wednesday.

Millions in donations

The scope of donations from Kashmir is significant. Estimates from local authorities place the value of contributions at up to six billion rupees ($64m), including cash, gold, jewellery, household items, livestock, and vehicles.

Collection points in Srinagar, Budgam, Baramulla – another major city – and the region’s northern districts were staffed by volunteers documenting donations.

Small contributions, including coins, piggy banks, and utensils, make up a large portion of total aid in terms of volume. Syed Asifi, a volunteer managing central Srinagar collections, said even individuals with limited means brought what they could.

Medical kits were assembled by local doctors, and supply drives were organised by students and educational institutions based on assessed needs in Iran.

The Iranian embassy in New Delhi acknowledged contributions in a post on X: “We sincerely thank the kind people of Kashmir for standing with the people of Iran through their humanitarian support and heartfelt solidarity; this kindness endures.” A video shared by the embassy showed a widow donating gold she had kept as a memento of her husband, who died 28 years ago.

That post was subsequently pulled down by the embassy, though the mission later posted again, thanking the people of India and Kashmir.

The embassy added that Kashmir’s contributions constitute a substantial portion of donations from India, with local sources estimating the Valley’s share at more than 40 percent of the total.

Security concerns

But while the majority of donations are directed towards humanitarian purposes, Indian authorities have raised concerns about potential misuse. Jammu and Kashmir Police and the State Investigative Agency (SIA) have said some funds collected through door-to-door drives by unverified individuals could be diverted to local networks of separatists and armed groups.

“People depositing money directly to the Iranian embassy should not be worried,” said a senior official, speaking on condition of anonymity. “Collections by middlemen without transparent monitoring may not reach the intended recipients.”

Authorities have also asked volunteers to maintain records to ensure compliance with fundraising regulations.

There’s a reason for this concern, say Indian authorities.

They point to the example of 2023, where funds collected in southern Kashmir – ostensibly for humanitarian purposes – were allegedly instead funnelled towards rebel groups. Organisers of the Kashmir drives for Iran maintain that all efforts are humanitarian.

Pakistani officials are expecting a “major breakthrough” in talks between Iran and the United States on Tehran’s nuclear programme, sources have told Al Jazeera, as Islamabad steps up diplomatic efforts to end a war that has killed thousands of people.

The optimism on Wednesday came as a high-level Pakistani delegation, headed by Army Chief Asim Munir, arrived in Tehran to deliver a message from the US to the Iranian leadership, according to Iran’s Press TV broadcaster.

He was received by Iran’s Foreign Minister Abbas Araghchi, who expressed gratitude for Pakistan’s “gracious hosting of dialogue”. According to Press TV, Munir is also seeking to lay the groundwork for a second round of talks between the US and Iran.

Al Jazeera’s Osama Bin Javaid, who has been covering the US-Iran talks, said Pakistani officials were expecting “a major breakthrough on the nuclear front” and that the delegates were continuing to relay messages back and forth between Washington and Tehran.

The central sticking point remains the duration of any enrichment freeze by Iran and the country’s stockpile of 440 kilogrammes of highly enriched uranium.

“We know that both sides are essentially stuck on between five years of no enrichment to 20 years of no enrichment. And there is a solution in the middle,” Bin Javaid said.

“There’s also talk about what Iran will do with the 440kg of nuclear-enriched material that it has in the country. There are multiple options – whether sending it abroad to a third party or bringing it down to either uranium in its natural form or up to 3 percent,” he said.

“According to these sources, there’s major headway that has been made, and they’re expecting that the Pakistanis are going to be able to convince Tehran,” he added.

Shuttle diplomacy

The shuttle diplomacy by Pakistan came after talks between the US and Iran in Islamabad ended over the weekend without an agreement to end the war. Mediators are pressing for a compromise on three main issues: Iran’s nuclear programme, control of the Strait of Hormuz – which Tehran has effectively closed, causing a surge in global oil prices – and compensation for wartime damages.

The conflict, launched by the US and Israel on February 28, has killed more than 3,000 people in Iran and triggered retaliatory attacks by Tehran on Gulf countries. It has also reignited a conflict between Israel and Hezbollah in Lebanon, where Israeli forces have killed more than 2,000 people since March 2.

A ceasefire between Tehran and Washington on April 8 has halted attacks in Iran and the Gulf, but strikes by Israeli forces on Lebanon have continued.

Separately on Wednesday, Pakistan’s Prime Minister Shehbaz Sharif also travelled to Saudi Arabia as part of a regional tour that also includes stops in Qatar and Turkiye. Al Jazeera’s Bin Javaid said Sharif’s tour was part of a “double-pronged strategy”.

“While the Iranians are speaking to the Pakistani military chief, the Pakistani prime minister and foreign minister are talking to the Saudis and the Qataris. The day after, they go to Turkiye,” he said, with the aim of neutralising any detractors to a deal

Bin Javaid said the detractors include elements in Tehran, in Washington, DC, and most of all, Israel, “which does not want a peace deal and wants a perpetual war in the region”.

‘Very close to over’

The diplomatic push appears bolstered by optimistic comments from US President Donald Trump, who said late on Tuesday that the world should brace for an “amazing two days” and the war on Iran is “very close to over”.

White House Press Secretary Karoline Leavitt later said that further negotiations would likely be held in Islamabad, calling Pakistan-mediated discussions “productive and ongoing”.

“We feel good about the prospects of a deal,” she said on Wednesday.

In Tehran, Iran’s Ministry of Foreign Affairs confirmed that exchanges with the US have continued since the end of the talks in Islamabad. Spokesman Esmaeil Baghaei said “several messages have been exchanged through Pakistan” and that Iranian “positions have been expressed in those exchanges”.

Tensions remain, however.

A US Navy blockade on Iranian ports – which began following the end of the talks – remains in effect in the Strait of Hormuz. The US Central Command claimed it has turned back nine vessels as of Wednesday.

Iran’s military has denounced the blockade as a violation of the April 8 ceasefire. Iran’s Fars News Agency separately reported that a sanctioned Iranian supertanker had crossed the Strait of Hormuz despite the blockade, though it gave no further details.

Ali Abdollahi, the commander of Iran’s joint military command, has also threatened to halt trade in the region if the US does not lift its blockade. He warned that Iran would retaliate by blocking trade through the Red Sea, along with the Gulf and the Sea of Oman.