Iran-U.S. negotiations deadlocked: Tehran says Washington insists on "unreasonable demands," both sides’ positions difficult to reconcile

Iran-U.S. negotiations deadlocked: Tehran says Washington insists on "unreasonable demands," both sides’ positions difficult to reconcile

The US-Iran ceasefire negotiations have reached a deep stalemate, with both sides’ positions diverging further.

According to a Xinhua News Agency report citing Iranian media on the 11th, Iranian Foreign Ministry spokesperson Esmail Baghaei said that regarding the nuclear issue, related materials, and issues related to enriched uranium, Iran would make decisions and consider various options at the appropriate time. Iran’s priority in the negotiations is to end all forms of war and address urgent issues like ensuring maritime safety in the Persian Gulf and the Strait of Hormuz. He stated, “All suggestions we made in the text are reasonable and generous.” However, US officials insist on their “unreasonable demands”.

At the same time, according to media reports citing ship-tracking data, a Qatari LNG transport ship “Mihzem” suddenly turned around about 20 miles from the Strait of Hormuz on Monday—previously, a Qatari LNG ship had succeeded in crossing the strait for the first time, giving the market a brief period of optimism that soon faded.

Previously, Xinhua News Agency reported that Trump stated Iran’s proposal was “completely unacceptable,” pushing WTI crude oil futures up nearly 3% to $98 per barrel, as traders drove up the war risk premium over long-term disruption risks at the Strait of Hormuz. At the same time, Saudi Arabia publicly condemned Iran’s drone attacks on the UAE, Qatar, and Kuwait on Monday. Satellite imagery also showed an ultra-large oil tanker leaking oil near the strait, suspected to have been attacked.

The regional situation is heating up on multiple fronts. The intensity of conflict on the Lebanon front continues to escalate. The Israeli Defense Forces confirmed that a reservist soldier died in a Hezbollah drone attack, and Israeli Prime Minister Netanyahu held a high-level security meeting on Monday. Iran insists any ceasefire deal must include Lebanon, further narrowing negotiation space.

Negotiation Deadlock: Nuclear Issue the Greatest Obstacle

The core of both sides’ disagreement lies in the nuclear program. Washington’s focus remains on the nuclear issue, but Iran regards this as an unacceptable condition for negotiations. On Sunday, Trump said Iran’s multi-page counterproposal was “unacceptable” because it contained no commitments regarding Iran’s nuclear program.

Baghaei responded that Tehran’s core demands are: ending the war, lifting US sanctions, releasing frozen assets, ensuring safe passage through the Strait of Hormuz, and maintaining the security and stability of Lebanon. He stressed these demands are legitimate and added, “Unfortunately, the US continues to insist on its unilateral stance.” Iran also hinted that the US is excessively driven by Israel’s interests in the negotiations rather than its own strategic priorities.

The negotiations are conducted via Pakistan, and both sides have exchanged proposals and counterproposals over the past few days, but Washington’s final reply last weekend shows the positions remain far apart.

Strait of Hormuz: LNG Shipments Blocked, Oil Prices Rising

The tense navigation status of the Strait of Hormuz improved briefly over the weekend but deteriorated again. According to media citing vessel tracking data, a Qatari LNG ship successfully crossed the strait over the weekend—the first Qatari LNG export via the strait in over ten weeks of conflict—docking at a Pakistani port.

However, media reported on Monday morning that the fully loaded “Mihzem” was approaching the Strait of Hormuz, its destination also Pakistan:

“Pakistan is facing a natural gas shortage and has reached agreements with Iran for multiple batches of LNG shipments. If successful, it will be the second Qatari ship carrying LNG to Pakistan in a few days.”

But by 7 AM Eastern Time, the latest vessel tracking data shows the “Mihzem” suddenly turned back about 20 miles from Hormuz Island.

This reversal further heightened market concerns over the safety of navigation through the strait. The news of Trump rejecting Iran’s counterproposal, combined with the shipping developments above, pushed WTI crude oil prices up nearly 3%, reaching $98 per barrel.

Drone Attacks and Damaged Tanker: Security Risks Escalate Near Strait

The security situation near the strait is also grim. Satellite tracking agency Tanker Trackers revealed that an ultra-large crude oil tanker “BARAKAH” (IMO No. 9902615), belonging to Abu Dhabi National Oil Company (ADNOC) of the UAE, was attacked by a drone on May 4. Satellite images show the tanker left an oil-spill trail near the Strait of Hormuz. Before the attack, the ship had urgently transferred its cargo in the eastern UAE waters, and was hit again on its return voyage. ADNOC publicly condemned the attack. Meanwhile, there were reports of suspected large-scale oil spills near Kharg Island, but Iran denied any large-scale leakage.

On the Gulf states’ level, Saudi Arabia’s Foreign Ministry issued a statement on Monday, strongly condemning Iran’s drone attacks against the UAE, Qatar, and Kuwait the day before. The UAE said it intercepted two drones from Iran; Qatar said a drone hit a cargo ship from Abu Dhabi within its territorial waters; Kuwait said its air defense systems intercepted a hostile drone entering its airspace. Saudi Arabia’s Foreign Ministry demanded the “immediate cessation of flagrant attacks on Gulf countries’ territories and waters, as well as any attempts to close the Strait of Hormuz or disrupt international waterways,” emphasizing that security of international shipping lanes should be ensured in accordance with relevant international law.

Lebanon Situation: Iran Insists on Comprehensive Ceasefire, Doubts Over Negotiation Prospect

The intensity of conflict on the Lebanon front continues to rise, directly affecting the wider ceasefire talks. According to CCTV News, at local time on the 11th, the Israeli Defense Forces issued urgent evacuation warnings to nine villages in southern Lebanon, requesting residents immediately evacuate at least one kilometer from those locations.

The Israeli Defense Forces confirmed that reservist Alexander Glovanyov, 47, from Petah Tikva and a member of the 6924th Transport Battalion, died on Sunday afternoon in the Manara area near the Lebanon-Israel border after being hit in a Hezbollah drone attack. Lebanon’s Health Ministry said Israeli military actions in the past 24 hours had killed 51 people, including two health workers. Israeli fighter jets recently carried out large-scale bombings in southern Lebanon and the outskirts of Beirut.

Netanyahu held a high-level security meeting in Jerusalem on Monday, immediately after Trump’s rejection of Iran’s counterproposal and before Israel-Lebanon direct talks scheduled later this week in Washington.

Iran insists any broad ceasefire solution must include Lebanon, stating Lebanon’s conflict is intertwined with the Persian Gulf situation. US think tank Responsible Statecraft noted that the Trump administration has motivation to push for a deal, partly to extricate itself from the crisis at the Strait of Hormuz, but the Lebanon front currently shows no new progress to make this round of negotiations more optimistic than previous rounds.

Risk advisory and disclaimerThe market comes with risks and investment requires caution. This article does not constitute personal investment advice, nor does it take into account the specific investment objectives, financial situation, or needs of any particular user. Users should consider whether any opinions, views, or conclusions in this article are appropriate for their individual circumstances. Investing accordingly is at their own risk.