Iran says peace proposal includes reparations for war damage, US troop withdrawal - Headlines news and analysis from Global Banking & Finance Review
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Iran says peace proposal includes reparations for war damage, US troop withdrawal

Published by Global Banking & Finance Review

Posted on May 19, 2026

5 min read

· Last updated: May 19, 2026

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Trump says US may strike Iran again but that Tehran wants deal

US-Iran Tensions and Prospects for a Deal

By Humeyra Pamuk and Menna AlaaElDin

WASHINGTON/DUBAI, May 19 (Reuters) - President Donald Trump said on Tuesday that the United States may need to strike Iran again and that he had been an hour away from ordering an attack before postponing it.

Trump made the comments a day after saying he had paused a planned resumption of hostilities following a new proposal by Tehran to end the U.S.-Israeli war.

Trump's Statements on Military Action and Negotiations

"I was an hour away from making the decision to go today," Trump told reporters at the White House on Tuesday.

Iran's leaders are begging for a deal, he said, adding that a new U.S. attack would happen in coming days if no agreement was reached.

The United States has been struggling to end the war it began with Israel nearly three months ago. Trump has previously said that a deal with Tehran was close, and similarly threatened heavy strikes on Iran if it did not reach an accord.

Domestic Political Pressures

The U.S. president is under intense political pressure at home to reach an accord that would reopen the Strait of Hormuz - a key route for global supplies of oil and other commodities. Gas prices remain high and Trump's approval rating has plummeted as congressional elections loom in November.

Statements from US Officials

Oil prices settled lower on Tuesday after Vice President JD Vance said Washington and Tehran had made a lot of progress in talks and neither side wanted to see a resumption of the military campaign. "We're in a pretty good spot here," he said.

Speaking to reporters at a White House briefing, Vance acknowledged difficulties in negotiating with a fractured Iranian leadership. "It's not sometimes totally clear what the negotiating position of the team is," he said, so the U.S. is trying to make its own red lines clear.

He also said one objective of Trump's policy is to prevent a nuclear arms race from spreading in the region.

Iran's Response and Peace Proposals

Iran Promises Response to Any New Attack

IRAN PROMISES RESPONSE TO ANY NEW ATTACK

In Tehran, Ebrahim Azizi, head of the Iranian parliament's national security committee, said on X that pausing an attack was due to Trump's realization that any move against Iran would mean "facing a decisive military response."

Iranian state media said Tehran's latest peace proposal involves ending hostilities on all fronts including Lebanon, the exit of U.S. forces from areas close to Iran, and reparations for destruction caused by the U.S.-Israeli attacks.

Tehran also sought the lifting of sanctions, release of frozen funds and an end to the U.S. marine blockade, according to Deputy Foreign Minister Kazem Gharibabadi as cited by IRNA news agency.

The terms as described in the Iranian reports appeared little changed from Iran's previous offer, which Trump rejected last week as "garbage."

International Mediation Efforts

Both Sides 'Changing Goalposts', Says Pakistani Source

BOTH SIDES 'CHANGING GOALPOSTS', SAYS PAKISTANI SOURCE

Reuters could not determine whether military preparations had been made for strikes that would mark a renewal of the war Trump started in late February.

Trump said on Monday that Washington would be satisfied if it could reach an agreement that prevented Tehran from obtaining a nuclear weapon.

A Pakistani source confirmed that Islamabad, which has conveyed messages between the sides since hosting the only round of peace talks last month, had shared the Iranian proposal with Washington. 

The sides "keep changing their goalposts," the Pakistani source said, adding, "We don't have much time."

Current Situation and Ceasefire

Ceasefire Mostly Holding

CEASEFIRE MOSTLY HOLDING

The U.S.-Israeli bombing killed thousands of people in Iran before it was suspended in a ceasefire in early April. Israel has killed thousands more and driven hundreds of thousands from their homes in Lebanon, which it invaded in pursuit of the Iran-backed Hezbollah militia. 

Iranian strikes on Israel and neighbouring Gulf states have killed dozens of people.

The Iran ceasefire has mostly held, although drones have lately been ​launched from Iraq ​towards ⁠Gulf countries, including Saudi Arabia and ⁠Kuwait, apparently by Iran and its allies.

Recent Developments

The U.S. seized an Iran-linked oil tanker in the Indian Ocean overnight, the Wall Street Journal reported on Tuesday, citing three U.S. officials. The tanker, known as the Skywave, was sanctioned by the U.S. in March for its role in transporting Iranian oil, the report said. 

Objectives and Outcomes of the Conflict

Trump and Israeli Prime Minister Benjamin Netanyahu said they launched the war to curb Iran's support for regional militias, dismantle its nuclear programme, destroy its missile capabilities, and create conditions for Iranians to topple their rulers.

But the war has yet to deprive Iran of its stockpile of near-weapons-grade enriched uranium or its ability to threaten neighbours with missiles, drones and proxy militias. 

The Islamic Republic's clerical leadership, which had faced a mass uprising at the start of the year, withstood the superpower onslaught with no sign of organised opposition.

Reporting and Editorial Credits

(Reporting by Reuters bureaux; Writing by William Maclean, Doina Chiacu; Editing by Peter Graff, Andrew Cawthorne and Sanjeev Miglani)

Key Takeaways

  • Iran seeks reparations, U.S. troop withdrawal from its periphery, and sovereignty over the Strait of Hormuz, while demanding sanctions relief and asset transfers via its peace proposal. (theweek.com)
  • President Trump has temporarily halted a planned military strike on Iran to allow negotiations—citing pressure from Qatar, Saudi Arabia, and the UAE—but stands ready to resume hostilities if a deal isn’t reached. (thedailybeast.com)
  • U.S. officials described Tehran’s proposal as ‘insufficient’ and offering only token improvements over previous versions, raising concerns that the conflict may still escalate. (axios.com)

References

Frequently Asked Questions

What are the main terms of Iran's latest peace proposal to the US?
Iran seeks an end to hostilities, US troop withdrawal near its borders, reparations for war damage, lifting of sanctions, and release of frozen funds.
Has the US responded to Iran's peace proposal?
The US has not confirmed any agreements but discussed releasing some frozen Iranian funds and allowing peaceful nuclear activity under supervision.
What does Iran demand regarding US sanctions?
Iran's proposal calls for the lifting of US-imposed sanctions and the release of its frozen assets held by foreign banks.
What has been the impact of the US-Israeli war on Iran and Lebanon?
The conflict has led to thousands of deaths in Iran and Lebanon, forced displacements, and ongoing military tensions in the region.
Who is mediating the talks between Iran and the US?
Pakistan is acting as a mediator, having hosted a round of peace talks and conveyed proposals between both sides.

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