Iran says it won't meet with U.S. envoys, clouding prospects for peace deal
Stalled Negotiations and Regional Tensions
By Andrew Mills and Elwely Elwelly
DOHA/DUBAI, June 30 (Reuters) - Iran said on Tuesday it would not meet with top U.S. envoys who flew to the region following an outbreak of hostilities, clouding the prospects for a lasting peace between the two countries.
Ceasefire Terms and Diplomatic Challenges
Iranian officials also said the two sides must still sort out the terms of a ceasefire they signed two weeks ago before they could tackle more difficult topics, such as possible limits to its nuclear program.
The developments indicated the two sides are far apart on key pillars of the initial framework, which calls for Iran to lift its chokehold on the Strait of Hormuz in exchange for financial incentives, and sets up 60 days of negotiations to work out a permanent peace deal.
U.S. Envoys' Arrival and Mediation Efforts
U.S. President Donald Trump's son-in-law Jared Kushner and envoy Steve Witkoff arrived in Doha for what the White House described as "high level" talks, but Iran and host Qatar said they would meet with mediators, rather than the Iranians themselves.
Qatar said Prime Minister Sheikh Mohammed bin Abdulrahman al-Thani was among those to meet with Witkoff and Kushner.
"No meeting at any level with the American side has been scheduled for the coming days," Iranian Foreign Ministry spokesperson Esmaeil Baghaei said.
The two countries were due to commence lower-level technical talks, according to Majed al-Ansari, spokesperson for Qatar's foreign ministry.
Military Tensions and Strategic Waterways
Trump's Consideration of Military Strikes
TRUMP SAID TO BE CONTEMPLATING STRIKES
Looking for ways to break the deadlock, Trump has weighed a return to all-out war, holding conversations with Defense Secretary Pete Hegseth and Chairman of the Joint Chiefs of Staff General Dan Caine on conducting more strikes, the Wall Street Journal reported, citing U.S. sources familiar with the discussion. Reuters could not immediately confirm the report.
But for now Trump, who has publicly threatened Iran with more attacks, has decided to give diplomacy more time, the report said.
Strait of Hormuz: Control and Economic Impact
Shipping has partially resumed through the strait, which handled one-fifth of global oil and liquefied natural gas before the war broke out on February 28.
But Iranian officials said they had a right to manage traffic along with U.S. ally Oman, which lies on the other side of the strategic waterway, and would impose tolls in mid-August when the 60-day period expires.
"The sovereignty of the Strait of Hormuz lies with Iran and Oman, and traffic in the Strait is subject to arrangements determined by Iran," Iran's top negotiator, Mohammed Baqer Qalibaf, said on state TV.
U.S. Response to Iranian Plans
U.S. Vice President JD Vance said Iran would be prevented from charging tolls through the international waterway, telling The Michael Knowles Show, "This is not going to end in a place where the Iranians are collecting tolls on ships going through the Strait of Hormuz."
Vance also said in the interview recorded on Monday but released on Tuesday that oil flows through the Strait of Hormuz had returned to pre-war levels, even exceeding that on some days, without citing figures.
Economic and Political Repercussions
Global Markets and Inflation
Despite the uncertainty, oil prices have fallen since the weekend, when the U.S. bombed Iranian military facilities in response to drone strikes on commercial ships and Iran attacked U.S. military sites in Kuwait and Bahrain.
Vulnerable economies, however, could remain at risk from food and fuel price increases even after energy markets feel relief, the U.N. trade and development agency said on Tuesday.
The war pushed up global inflation and has put Trump under political pressure before midterm elections in November that will determine control of the U.S. Congress. Trump and Treasury Secretary Scott Bessent are both urging gasoline retailers to lower prices.
Regional Conflicts and Diplomatic Hurdles
The interim deal between the U.S. and Iran also provides for an end to the conflict between Israel and Iran-backed militant group Hezbollah in Lebanon.
But Lebanon's powerful parliament speaker Nabih Berri, an ally of Hezbollah, cast doubt on a separate, U.S.-brokered framework deal between Lebanon and Israel to halt that war.
Analysts said the deal risks entrenching a stalemate by tying Israel's withdrawal from southern Lebanon to Hezbollah's disarmament.
(Reporting by Reuters bureaux, Writing by Aidan Lewis and Daniel Trotta; Editing by Timothy Heritage, Gareth Jones, Sanjeev Miglani and Stephen Coates)
