For the first time in 34 years, Trump says Israeli and Lebanese leaders will hold talks.

A major diplomatic breakthrough has emerged in the Middle East, with prospects for peace driving global financial markets higher.

According to Xinhua News Agency, Trump announced on social media on the 15th that Israeli and Lebanese leaders will hold talks the next day, marking the first direct communication between the leaders of the two countries in more than 34 years.

Meanwhile, senior Pakistani military officials have arrived in Tehran to mediate U.S.-Iran negotiations, and the Israeli cabinet has convened to discuss a ceasefire proposal with Lebanon. Multiple diplomatic channels are advancing simultaneously, signaling the most intensive positive signs for the Middle East peace process in recent times.

Boosted by these developments, U.S. stock indices hit record highs on Wednesday and oil prices stabilized. However, analysts caution that, given the history of U.S.-Iran negotiations breaking down after apparent progress, market optimism remains subject to considerable uncertainty.

Direct Dialogue Between Israel and Lebanon: A Historic Contact After 34 Years

According to Xinhua News Agency's report on the 16th, Trump wrote in his post: “The leaders of the two countries (Israel and Lebanon) have not talked for a very long time, about 34 years. Tomorrow, it will happen.”

The day before, Israel, Lebanon, and the United States held trilateral talks in Washington on the 14th, agreeing to formally launch direct negotiations at an agreed time and location. Israel had previously refused to engage in direct talks with Hezbollah in Lebanon, marking a significant shift in position.

Media, citing Lebanese officials, reported that a ceasefire agreement may be announced soon. The conflict between Israel and Iran-backed Hezbollah reignited on February 28 this year, resulting in significant casualties, mainly in Iran and Lebanon. The Lebanon ceasefire issue has long been a central obstacle to broader Middle East peace talks.

Pakistan Mediates U.S.-Iran Negotiations; The Nuclear Issue Remains the Key Dispute

Beyond progress in Israel-Lebanon diplomacy, new developments have emerged in U.S.-Iran talks. Pakistani military confirmed media reports that Army Chief Munir has arrived in Tehran. An Iranian senior source told Reuters that Munir's visit is aimed at “narrowing” differences between the sides, having chaired the previous round of negotiations. Iranian Foreign Minister Abbas Araqchi posted on social media welcoming Munir’s visit and stated Tehran is committed to “promoting regional peace and stability.”

Last weekend’s talks broke off without an agreement. White House Press Secretary Karoline Leavitt said Wednesday that the U.S. is “optimistic” about reaching an agreement, describing the Pakistan-mediated talks as “productive and ongoing.” She denied reports that the U.S. has formally requested an extension to the two-week ceasefire agreement reached on April 8 and said a new round of face-to-face talks has not yet been confirmed, though they may still take place in Pakistan.

The nuclear issue remains the core obstacle in the negotiations. Sources indicated the U.S. has proposed Iran suspend all nuclear activities for 20 years, a softening from previous demands for permanent prohibition; Iran proposes a suspension of three to five years. In addition, the U.S. wants Iran’s enriched nuclear materials relocated abroad, while Iran insists on the removal of international sanctions.

Hormuz Strait Blockade Continues; Economic Pressure on Iran

Alongside diplomatic mediation, the U.S. is exerting economic pressure on Iran.

Media reports indicate the U.S. military said that during the first 48 hours after the blockade was implemented, no vessels successfully passed through U.S. interception, with nine ships ordered by the U.S. military to return to Iranian ports or coastal areas. However, Iranian Fars News Agency reported that an Iranian supertanker under U.S. sanctions has traversed the strait and headed to Imam Khomeini Port in Iran, though no specific details were provided.

Iran’s joint military command warned that if the U.S. blockade continues, trade flow in the Persian Gulf, Oman Sea, and the Red Sea will be cut off. Meanwhile, a source familiar with Tehran’s position revealed Iran may consider allowing free passage through the strait via the Oman side as part of negotiation options, provided an agreement is reached to prevent renewed conflict.

Toshitaka Tazawa, an analyst at Fujitsu Securities, said: "Although the market hopes the situation will cool down, many investors remain skeptical, as U.S.-Iran talks have repeatedly stalled after seeming progress." Trump also hinted during an interview that if war flares up again, the U.S. does not rule out further escalation, but added, "We don’t want that." Whether negotiations will ultimately succeed remains to be seen.

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