US, Iran fail to reach a deal after talks in Pakistan

The United States and Iran have failed to reach any agreement after 21 hours of talks that concluded on Sunday in Pakistan, putting a fragile two-week ceasefire at grave risk as the six-week-old conflict, which has killed thousands and sent global oil prices soaring, hangs in the balance.

The face-to-face talks in Isla­mabad marked the first direct high-level meeting between Washington and Tehran in more than a decade, and were their most senior diplomatic encounter since the 1979 Islamic Revolution.

Iran's semiofficial Tasnim news agency said that "excessive" US demands had blocked reaching an agreement. Other Iranian media outlets said that there was agreement on a number of issues, but that the Strait of Hormuz and Iran's nuclear program were the main points of difference.

Esmaeil Baghaei, a spokesman for Iran's Foreign Ministry, described the negotiations as taking place in an atmosphere of deep distrust. "It is only natural that we could not have expected to reach a comprehensive agreement in just one round of talks," he said.

When asked whether diplomacy had been exhausted, he said, "Diplomacy never ends."

Iran had been in the middle of nuclear negotiations with US President Donald Trump's special envoy Steve Witkoff and his son-in-law Jared Kushner in late February when the US and Israel — Washington's closest Middle East ally — launched military operations against Iran. The attacks triggered sweeping retaliation by Tehran that plunged the region into full-blown conflict.

JD Vance, US vice-president and head of the US delegation, told reporters that Iran had chosen not to accept US terms while insisting that he had put forward a "final and best offer".

"The bad news is that we have not reached an agreement, and I think that's bad news for Iran much more than it's bad news for the US," he said. His remarks, however, offered no clarity on what happens once the 14-day ceasefire brokered by Pakistan expires.

Pakistani mediators urged both sides to uphold the truce. "We hope that the two sides continue with a positive spirit to achieve durable peace and prosperity for the entire region and beyond," said Pakistani Foreign Minister Ishaq Dar.

"There were mood swings from the two sides and the temperature went up and down during the meeting," a Pakistani source told Reuters in reference to the talks, which began on Saturday and continued overnight.

The Iranian delegation was led by Parliamentary Speaker Mohammad Bagher Ghalibaf and Foreign Minister Abbas Araghchi. Analysts had earlier said that its composition signaled Tehran's seriousness about securing a deal in Islamabad.

"The size, seniority and scope of the Iranian delegation … signal both Tehran's sincerity in these negotiations and its clear expectations and confidence," said Trita Parsi, executive vice-president of the Quincy Institute for Responsible Statecraft and an expert on US-Iran diplomacy.

Before the talks began, a senior Iranian source told Reuters that the US had agreed to release frozen Iranian assets in Qatar and other foreign banks. A US official denied making any such commitment.

According to Iranian state television and officials, Tehran is also demanding full control of the Strait of Hormuz, war reparations and a regionwide ceasefire covering Lebanon.

However, Israel has insisted that the Lebanon conflict is not within the remit of the truce with Iran, which has maintained that the fighting in Lebanon must stop. Lebanese authorities said that Israeli strikes on southern Lebanon on Saturday and early Sunday killed 18 people, pushing the overall death toll from Israel's campaign past 2,000 since the conflict began.

The closure of the Strait of Hormuz has become Iran's most powerful strategic card in the conflict. Before the conflict, around one-fifth of the world's seaborne oil transited the waterway daily in more than 100 vessels. Since the ceasefire took hold, only 12 ships have reportedly been recorded as passing through.

During the negotiations, the US military announced that two destroyers had transited the strategic waterway ahead of mine-clearing operations — the first such passage since the conflict started. Iran's joint military command quickly denied the claim.

"Any attempt by military vessels to cross the Strait of Hormuz will be confronted firmly and decisively," Iran's Islamic Revolutionary Guard Corps said in a statement.

Hours after the talks ended without a deal, Trump announced that the US Navy would immediately blockade the Strait of Hormuz and interdict any vessel in international waters that had paid a toll to Iran.